- Ethereum’s price has been on a downward trend since the beginning of March, mirroring Bitcoin’s movements. However, a potential turnaround could be on the horizon.
- Technical analysis indicates that Ethereum is currently approaching a key resistance level of $3,000, with a bullish breakout potentially leading to a rise towards the $3,600 resistance zone.
- The Taker Buy Sell Ratio, a key metric in the perpetual futures market, is showing signs of recovery, which could signal the start of a new uptrend for Ethereum.
As Ethereum’s price follows Bitcoin’s downward trend, technical and sentiment analysis suggest a potential turnaround, with key resistance levels and market metrics indicating a possible uptrend.
Technical Analysis: Ethereum’s Potential Rebound
On the daily timeframe, Ethereum’s price has been making constant lower highs and lows inside a descending channel pattern. However, with the 200-day moving average and the $2,750 support level nearby, the market seems poised for a rebound. Currently, the price is approaching the $3,000 resistance level. A bullish breakout above this level could lead to a rise toward the higher boundary of the channel and the $3,600 resistance zone.
Short-Term Market Momentum
On the 4-hour chart, Ethereum’s price has been hovering around the $3,000 level in recent weeks. The market has broken a bearish trendline to the upside. If the price maintains above the trendline and breaks through the $3,000 level, a rally toward the higher boundary of the channel becomes more likely. With the RSI approaching 50%, the market momentum appears to be in equilibrium, but the short-term fate could be decided soon.
Sentiment Analysis: Signs of Recovery
The perpetual futures market has been a key driver for crypto prices in recent years. Therefore, analyzing this market’s metrics can provide useful information for anticipating future price movements. The 30-day moving average of the Taker Buy Sell Ratio, which measures whether buyers or sellers are executing more market orders on aggregate, has been trending below 1 over the last few months. This indicates that most futures traders have been selling BTC aggressively. However, the metric is showing signs of recovery, and its rise could lead to a market rally as the aggressive supply would shrink. Therefore, with enough demand from the spot market, a new uptrend for Ethereum could begin soon.
Conclusion
While Ethereum’s price has been following Bitcoin’s downward trend, technical analysis and market metrics suggest a potential turnaround. Key resistance levels and signs of recovery in the Taker Buy Sell Ratio could signal the start of a new uptrend for Ethereum. However, as with all investments, potential investors should conduct their own research and exercise caution.
