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Ethereum (ETH) Price: Can Bulls Reclaim $4,000 After Record Sell-Off?
The cryptocurrency market has been plagued by intense volatility lately, with numerous digital assets experiencing significant price swings. Ethereum (ETH), the world’s second-largest cryptocurrency by market capitalization, has not been spared from this turmoil. In a record-breaking sell-off, ETH plummeted 3.63% over the past week, eroding support and potentially signaling a change in investor sentiment.
At its current trading range of $3,621-$3,643, Ethereum is facing immense pressure to hold onto these levels. Any failure to maintain price stability could further accelerate the downswing, placing the cryptocurrency at risk of extending the decline.
As bulls eye potential recovery, many are questioning whether they can reclaim the $4,000 mark after this drastic downturn. While ETH has consistently demonstrated resilience in the past, its recent performance is not entirely convincing. With institutional investors still accumulating Ethereum and whale transactions indicating a possible accumulation phase, could the cryptocurrency regain momentum and potentially reach new heights?
The answer lies within its price action and technical indicators.
From a technical perspective, Ethereum recently formed a cup and handle formation pattern on cryptocurrency charts. This chart pattern typically signals bullish continuation when executed properly for digital assets like ETH. Although Ethereum failed to break above the neckline resistance at $3,950, bulls have been absorbing supply at current levels. This absorption of ETH tokens suggests sustained demand for the cryptocurrency around the $3,600 support range.
However, a potential shift in investor sentiment amid this Ethereum price action creates uncertainty regarding future direction. The cryptocurrency has recently demonstrated an inability to break above key resistance zones, potentially weakening its upward trajectory.
Ethereum network activity presents another perspective on the situation. Despite a record-breaking sell-off, long-term holders continue to hold strong conviction for ETH valuation. The MVRV Long/Short Difference exceeds 12.36%, indicating that market participants maintain sizable unrealized gains.
This development might be seen as positive in the long run. Nonetheless, bulls must navigate Ethereum’s immediate price action before focusing on a future $4,000 mark. Short-term support exists around $3,396, with the possibility of ETH falling to $3,144 if this level breaks.
Despite the challenges facing Ethereum’s current trading range, it is crucial for investors to focus on medium and long-term fundamentals rather than short-term price movements.
Source: coincentral.com
