Ethereum’s price has entered a downward trend, aligning with the broader market movement among the top cryptocurrency coins. As of now, ETH has decreased by over two percent, positioning itself slightly below the $3,300 mark. This fluctuation is causing concern among investors and traders who are keenly observing the market dynamics.
Long-Term Analysis: Approaching the End of the Cycle
When examining Ethereum’s long-term performance, it appears to follow the Elliott Wave pattern, a theory that provides insights into market sentiment and potential future movements. This analysis, while somewhat subjective, gains credibility through the integration of Fibonacci levels and support areas, which offer a more objective lens.
Ethereum is currently experiencing an upward trend, suggesting it may be nearing the completion of a significant cycle. Since the 2018 low, the cryptocurrency has formed Waves 1, 2, 3, and 4, which sets the stage for the potential emergence of Wave 5. This wave could indicate a possible peak in the current trend. Despite this progression, a new higher high surpassing the 2021 peak is yet to be established.
Momentum Weakening: Signals of Exhaustion
Recent Ethereum price movements reveal a weakening momentum compared to earlier phases. Waves 1 and 3 were characterized by aggressive price increases, but Wave 5 is exhibiting signs of decreased strength, a common occurrence towards the end of a market cycle. This development indicates that the bull market might be entering its final phase, making Ethereum trading more challenging and increasing risk levels for market participants.
Corrective Phase: Watching Support Zones
Ethereum is currently navigating through a corrective phase, potentially forming Wave 2 in an ABC pattern. For this corrective phase to remain valid, support levels between $2,470 and $3,167 need to hold firm. Should these levels maintain their integrity, there remains the possibility of a price rally, with the ideal target being $3,572.
Bearish Shift: Key Support Breaks
On the flip side, if Ethereum’s price falls below the $2,470 support zone, the market outlook could shift to a bearish trend. While the market is still within a corrective phase, a break above critical resistance levels, particularly between $3,415 and $3,648, would confirm the potential for a more bullish trend to develop. Investors and traders should remain vigilant, closely monitoring these key levels to anticipate future market movements.
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