Ethereum is facing a critical test of resistance, specifically around the 0.618 Fibonacci level and other technical barriers. Key support at $1,055 is essential for a potential bullish reversal. A failure to hold this support could reinforce ongoing bearish trends, while strong support and a breakout could suggest a new upward trajectory.
Ethereum is currently at a critical junction as it tests major resistance levels. After several attempts to break through this barrier, there’s mounting evidence of weakness in the price action. The outcome of this testing phase could be crucial, determining whether Ethereum can reverse its bearish trend or if it will plunge deeper into a macro downtrend.
The resistance Ethereum faces includes the 0.618 Fibonacci retracement level, VWAP supply resistance, and a key horizontal daily support level. These factors indicate that while there has been a notable rally recently, Ethereum could still be at risk of further declines if this resistance holds firm. This is a pivotal moment.
In terms of support, the critical level to keep an eye on is around $1,055. This high-timeframe level must hold for Ethereum to form what’s called a bullish structure. If this support fails, it risks breaking the swing low, which would confirm the continuation of the bearish trend seen on the daily timeframe.
The situation for Ethereum is undeniably pivotal; it’s currently trading within a nexus of resistances. Recent daily candles have struggled to close above these levels, pointing to underlying weakness despite last week’s rally. If Ethereum can hold at the $1,055 mark, it might indicate the formation of a higher low, a potential signal of strength yet to be confirmed.
Considering the broader picture, a rejection at the current resistance levels could set the stage for a continuation of lower lows and lower highs trend. In contrast, a strong bounce off $1,055, ideally coupled with rising trading volume, could suggest a bullish turnaround and propel Ethereum toward a significant trend shift.
So, what could happen next? If Ethereum cannot break above current resistance, we may see confirmation of another lower high, leading to a retest of that crucial $1,055 support. Should this support falter, another sell-off could follow, pushing prices down further.
On the flip side, if aggressive buying emerges at $1,055, and if Ethereum can soon rally past resistance convincingly, it could indicate a new bullish trend is beginning. This would pave the way for potentially setting a new higher high, changing the current bearish landscape into a more optimistic one.
