Ethereum is poised for a potential breakout as it approaches $1,850, supported by rising long positions and favourable on-chain indicators. The price has recently crossed critical resistance levels, indicating bullish momentum. With historical trends and diminishing selling pressure hinting at a positive outlook, Ethereum could soon challenge the $2,000 mark.
Ethereum is on the cusp of a potential breakout as it inches closer to the $1,850 mark. Rising open interest, an uptick in long positions, and intriguing on-chain volume trends suggest that a bottom could be forming. Meanwhile, Bitcoin’s recent surge past $97,000 could add pressure on Ethereum, which has been testing its $1,800 resistance level. The question remains: can a post-retest reversal propel Ethereum above the $2,000 threshold?
Analysing the daily chart reveals some promising signals for Ethereum. The price recently crossed above a long-standing resistance line, indicating a bullish breakout from a falling channel pattern. Currently, Ethereum trades at $1,821 after a notable 2.51% rise last night. However, a robust supply zone around the $1,850 level may prove to be a sticking point for this bullish trajectory. If Ethereum can break through this zone, it could trigger a much-anticipated rally.
Around the $1,850 mark, Ethereum’s progress is met with significant resistance; this could lead to a retest of previous levels. On the upside, the MACD and signal lines are showing positive momentum, hinting at a potential shift towards bullish activity. Furthermore, the declining 50-day EMA aligns closely with this resistance zone, which means that breaking above it could act as a significant buy signal for traders. Fibonacci levels suggest that next major resistance could hover around the psychological mark of $2,000, with the 200-day EMA poised at roughly $2,400 offering further resistance.
Examining the derivatives market, there’s a notable increase in long positions for Ethereum. The latest figures from the Ethereum Long-to-Short Ratio indicate that 53.72% of positions have shifted towards long over a four-hour period. This brings the Long-to-Short Ratio to 1.1608, suggesting bullish sentiment prevails. Additionally, an increase of over 3% in open interest has propelled it to $21.60 billion, all while the market funding rate hovers close to zero. Such conditions lower the carrying costs for long positions, likely contributing to the positive outlook.
Historically, the signs for Ethereum are also encouraging. Data from CoinGlass shows that Ethereum has typically enjoyed favourable returns in the second quarter, with positive results in seven out of the last nine years since 2016. The average return for Q2 stands at an impressive 60%, while the median return is 12.12%, reinforcing the notion of potential upward momentum in the months ahead.
Interestingly, selling pressure appears to be on the decline. As reported by CryptoQuant, net taker volume has turned positive on recent dates, signalling a growing willingness among buyers. Data shows that as of May 1, the 30-day moving average for Ethereum’s taker volume was $311,406, a notable increase. If this trend continues, it may indicate a more stable bottom for Ethereum, potentially paving the way for a bullish recovery and a broader market reversal in the weeks ahead.
