Ethereum price is hovering near the $2,000 mark after failing to break above the $2,050 resistance level, showing signs of potential further decline as it trades below key technical indicators and faces multiple resistance barriers.
<u>What to Know:</u>
- Ethereum is trading below both the $2,020 price point and the 100-hourly Simple Moving Average
- A bearish trend line has formed with resistance at $2,040 on the hourly ETH/USD chart
- The cryptocurrency must overcome $2,040 and $2,100 resistance levels to establish meaningful upward momentum
Technical Analysis Points to Continued Struggle
Ethereum's upward momentum stalled as the cryptocurrency failed to sustain movement above the $2,100 threshold, mirroring Bitcoin's recent price action.
The second-largest cryptocurrency by market capitalization subsequently retreated below multiple support levels at $2,040 and $2,020, eventually testing the critical $1,980 zone where it established a temporary low of $1,982.
A modest recovery attempt pushed the price above $2,020, reaching approximately the 50% Fibonacci retracement level of the recent decline from the $2,098 swing high to the $1,982 low. This recovery, however, lacked sufficient buying pressure to overcome key resistance barriers.
Technical indicators currently paint a cautious picture for Ethereum traders. The price now trades below both the psychologically important $2,020 level and the 100-hourly Simple Moving Average, suggesting bearish sentiment in the short term. Adding to the pessimistic outlook, a connecting bearish trend line has formed with resistance at $2,040 on the hourly chart of ETH/USD.
The $2,040 level represents the immediate hurdle for any potential recovery, with additional significant resistance near $2,050 and the 61.8% Fibonacci retracement level of the recent downward movement. The first major resistance is positioned near $2,095, a level that has repeatedly rejected upward price action in recent trading sessions.
Should Ethereum successfully break above the $2,095 resistance, the path could potentially open toward the $2,150 level. An upside break beyond $2,150 might trigger more substantial gains in the coming trading sessions, potentially pushing Ether toward the $2,250 resistance zone or even $2,320 in the near term, according to chart analysis.
Downside Risks Remain Prominent
The inability to overcome resistance at $2,040 could trigger another decline for Ethereum. Initial support on the downside appears near the psychologically significant $2,000 level, with the first major support positioned at the $1,980 zone that recently prevented further decline.
A decisive move below the $1,980 support level could accelerate selling pressure, potentially pushing the price toward deeper support at $1,880. Continued bearish momentum might drive Ethereum toward the $1,820 support level in the near term, with the next critical support established at $1,750.
Technical indicators offer little immediate relief for bulls. The MACD (Moving Average Convergence Divergence) for ETH/USD is losing momentum in the bearish zone, while the RSI (Relative Strength Index) has fallen below the neutral 50 level, both suggesting potential for continued downward pressure.
Final Thoughts
Ethereum's current price action reflects broader uncertainty in the cryptocurrency market. The failure to maintain momentum above key resistance levels has left the market vulnerable to further downside, despite periodic recovery attempts. Traders should closely monitor the identified support and resistance levels as they will likely determine Ethereum's short-term price trajectory in the coming trading sessions.