Ethereum Targets $3.6k Despite Bearish Market Structure and Low Volume

• Ethereum recently demonstrated a bearish market structure on the daily chart, yet it targets the next significant resistance zone.
• Trading volume has been notably sub-par in recent days, suggesting that a retracement in the following week is possible.
• Ethereum’s value reclaimed the $3,000 level, and intriguingly for bullish traders, the prior resistance at $3,100 has turned into support.

Ethereum’s volatile market structure is paving the way for potential future resistance targets, as trading volumes suggest movement dynamics.

Ethereum Breaks Above Key Levels, Eyes On Higher Resistance

Ethereum’s [ETH] recent market activities saw it breaking above the pivotal $3,000 mark. Even more compelling was the shift of the $3,100 region from resistance to support, suggesting bullish momentum. However, the daily trading volumes have remained underwhelming, hinting at a possible price retracement in the near future. Despite the short-term bearish signals, ETH’s strength above these key levels can not be ignored.

Volume Indicators and Market Sentiment

Ethereum’s volume indicators present a mixed outlook. For instance, on Saturday, July 13th, Ethereum closed the daily trading session at $3,201, breaking the $3,100 resistance zone. Despite this, the overall market structure, coupled with bearish momentum, remained evident on the daily timeframe. The Chaikin Money Flow (CMF) indicated a negative reading of -0.05, highlighting a significant outflow of capital. Similarly, the On-Balance Volume (OBV) failed to initiate an upward trend as the buying volume remained lethargic over the past ten days. The Relative Strength Index (RSI), recorded at 45, signaled bearish momentum despite a slight upward creep in the past week.

Insight From Liquidation Heatmap

The liquidation heatmap offers intriguing clues about potential resistance zones. Notably, the $2,700-$2,800 region to the south persists as an attractive liquidity pool, having been partially tested in early July. This bounce above the $3,100 mark implies that the next liquidity cluster, situated between $3,500-$3,700, may become the bulls’ next focal point.

Open Interest and Market Sentiment

The rise in Open Interest alongside Ethereum’s climbing price and a positive funding rate signals a broadly bullish sentiment prevailing in the market. The recovering spot Cumulative Volume Delta (CVD) further fortifies this bullish outlook. Provided these trends persist, Ethereum’s probability of targeting the $3,600 level appears robust.

Conclusion

In summary, while Ethereum’s daily chart indicates a bearish market structure, its ability to reclaim and hold above $3,000, and turn the $3,100 resistance into support, paints a nuanced picture of potential bullish outcomes. The varied volume indicators and liquidity clusters suggest multiple scenarios, yet the bullish sentiment seen in Open Interest and the market’s positive funding rate provide a hopeful horizon for ETH traders. Future market moves will crucially depend on increased trading volumes and sustained positive sentiment, key factors that will determine Ethereum’s journey towards the $3,500-$3,700 resistance zone.