Key Points
- Ethereum’s market structure has turned bearish, with increasing selling activity and volume.
- There’s a possibility of Ethereum’s price heading towards the next support zone at $2600.
The market structure of Ethereum (ETH) has taken a bearish turn.
This comes as a result of a surge in selling activity, largely driven by profit-taking amidst a climate of fear.
Bearish Signals and Support Zones
The bearish trend was particularly pronounced in April, with the selling volume on the rise.
The indicators on the one-day timeframe also reflected this bearish sentiment.
The lackluster volume from the Hong Kong ETFs on their first day painted a clear picture of the market’s attitude towards Ethereum and the broader crypto market.
The higher timeframe trend of Ethereum took a bearish turn after the price fell below the $2906 swing low.
If the daily session closes below this level, it’s highly likely that the price will move towards the next support zone, which is around $2600.
Downward Momentum and Liquidation Levels
This support zone coincides with the previous range highs that Ethereum traded within a few months ago.
The RSI on the 1-day timeframe has been below the neutral 50 mark for most of April, indicating a sustained downward momentum.
The OBV also fell below a support level recently and retested it as resistance.
It’s expected that Ethereum will experience significant losses before reaching the next significant level on the indicator.
The closest cluster of liquidation levels for Ethereum is downward, with the $2640-$2750 region presenting a lucrative pocket of liquidity.
This region also aligns with the bullish order block highlighted at the range highs.
It’s anticipated that Ethereum will descend to this liquidity pocket before a reversal occurs.
The probabilities of a reversal before reaching these liquidation levels are low, as these levels often act as magnetic zones to the price.
Please note, this information does not constitute financial, investment, or trading advice and is merely the writer’s observation.
