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Ethereum Price Analysis: Is ETH Doomed to Slump to $3K After Getting Rejected at $4K?
The cryptocurrency market is abuzz with concern as Ethereum (ETH) fails to break the $4,000 resistance level and instead experiences a sharp correction. The bears are rejoicing, while the bulls are left wondering what could have gone wrong. Is ETH doomed to slump to $3K? Let’s dive into an in-depth analysis to uncover potential scenarios.
To begin with, it’s essential to examine the technical side of things. According to the daily chart, Ethereum has entered a bearish phase after failing to make headway toward new highs. The price action is now trending downward, and the asset has lost the key $3,500 resistance zone. This development has led many to ponder the potential consequences.
In this regard, I’d like to analyze the 4-hour chart. Upon examination, it becomes clear that the market has failed to break above the $4,000 level twice, resulting in a classic double-top pattern formation. The neckline of this pattern, at $3,500, has been breached to the downside, indicating a significant bearish momentum.
Furthermore, we can draw some insightful conclusions by looking into sentiment analysis. A quick glance at the Taker Buy Sell Ratio reveals that the market is experiencing a massive drop in buying pressure over the past year. This development suggests that the recent correction could be attributed to heavy selling pressure emanating from the futures market rather than the spot market.
It appears that there is more to this narrative than just a simple rejection, as I have always maintained.
Source: cryptopotato.com
