- Ethereum price continues to consolidate around $1,570 with no signs of directional bias.
- A breakdown of the market structure at $1,515 could result in a quick descent to key accumulation levels.
- A daily candlestick close above $1,679 would invalidate the bearish thesis for ETH.
Ethereum price shows a clear sideways structure as it encounters a crucial hurdle. As a result, ETH has set up a liquidity zone around this level, but the winds might shift in favor of bears and induce volatility on February 1 when the Federal Open Market Committee (FOMC) convenes.
Ethereum price at critical juncture
Ethereum price has set up equal highs at $1,679 after failing to push through it. As a result of the buy-stop liquidity resting above this hurdle, there is a likelihood that ETH market makers will push the altcoin higher before triggering a massive selling spree.
The bearish outlook will compound if Ethereum price breaks the bullish market structure by producing a lower low below $1,515. This move will shift the odds in the bears’ favor and kick-start a sell-off that will likely knock ETH down to two key levels - $1,429 and $1,331.
Ethereum price rallied 41% in the first three weeks of 2023 and the midpoint of this ascent is $1,429, hinting that a mean reversion play could be opening up for short-sellers. If the selling pressure continues to build up ETH could slice through $1,429 and reach the next support level at $1,331.
Further adding credence to the bearish outlook for Ethereum price is the Relative Strength Index, which has developed a bearish divergence. This technical formation hints that ETH is likely to collapse due to the declining momentum but rising prices.
ETH/USDT 1-day chart
Regardless of this pessimistic outlook, bears should be wary of a liquidity run that could trigger a sweep of the equal highs formed at $1,679. If this move is followed by a spike in selling pressure that triggers Ethereum price to flip the aforementioned level into a support floor, it would not only produce a higher high but also favor sidelined buyers to step in.
Such a move from Ethereum price would invalidate the bearish outlook and potentially trigger a swift move to $1,820 and 2,013 hurdles.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Trust Wallet with over 100 million users back on Google Play Store after temporary removal
Trust Wallet is a non-custodial software wallet that allows traders to send, receive, exchange and hold digital assets. Users can hold cryptocurrencies and NFTs in their Trust Wallets. The wallet disclosed its removal from Google’s application store, Play Store, early on Monday.
Maker loses 9% in past 24 hours as whales sell MKR for profits
Maker (MKR) wiped out 9% of its value in the past 24 hours. Data from crypto intelligence tracker Santiment shows that large wallet investors are taking profit on their MKR holdings, likely driving down the asset’s price.
Week Ahead: Bitcoin could surprise investors this week Premium
Two main macroeconomic events this week could attempt to sway the crypto markets. Bitcoin, which showed strength last week, has slipped into a short-term consolidation. However, a shift in momentum could soon bring forth a momentary rally for BTC and altcoins.
XRP slides to $0.50 as ETHgate controversy resurfaces, Ripple CTO debates impact on litigation
Ripple (XRP) loses all gains from the past seven days, trading at $0.50 early on Monday. XRP holders have their eyes peeled for the Securities and Exchange Commission (SEC) filing of opposition brief to Ripple’s motion to strike expert testimony.
Bitcoin: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s (BTC) recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.