In the ETH/USD daily chart, we can see that after a strong bullish trend, the market has entered a distribution phase followed by a deep correction. The breakdown of the key support zone around 3400–3600 USD (the upper green box) effectively invalidated the previous bullish structure. This area has now turned into a resistance / supply zone, where selling pressure is clearly dominant and price fails to achieve acceptance above it.
Following this breakdown, price moved lower into the major demand zone highlighted by the lower blue box. This zone has historically acted as a strong support and triggered bullish reactions in the past. However, the current reaction appears more like a weak bounce or corrective move within a broader downtrend, rather than the start of a new bullish trend, as no clear bullish structure has yet formed on the daily timeframe.
The more likely scenario is a short-term corrective move upward, followed by another leg down toward the lower boundary of the demand zone or even a sweep of lower liquidity levels. If this support zone holds firmly and price manages to break above recent short-term highs, a mid-term bullish move toward higher levels could become possible. Otherwise, any upside movement is more likely to be viewed as a sell-on-rallies opportunity rather than the beginning of a sustained rally.
Overall, ETH is currently at a critical decision zone, where price behavior within the lower demand area will determine the market direction for the coming weeks. Until the previously broken resistance zone is reclaimed, the broader bias remains cautious and bearish-leaning.
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