Is ETH doomed to fall to $3,000 after being rejected at $4,000?

Ethereum price has failed to advance to a new record high and is currently experiencing bearish price action, leading market participants to worry that the bull run is over.

The asset is now holding below $3,500, which has become a key resistance line.

Technical Analysis

By Edris Derakhshi (TradingRage)

The daily chart

On the daily chart, the price has entered a bullish phase since early November after recovering from the $2,300 support level. However, the $4,000 resistance zone has rejected the market to the downside, with the $3,500 level also lost.

Currently, the market is likely to drop towards the $3,000 support zone and the 200-day moving average, located around the same price. As long as ETH trades above the 200-day moving average, the overall market trend can be considered bullish. Otherwise, a deeper drop towards the $2,000 area could be expected.

The 4 hour chart

Looking at the 4-hour period, it is clear that the market has failed to break the $4,000 resistance level twice, forming a clear double top pattern.

With the pattern’s neckline, which is the $3500 level, broken to the downside and the RSI showing bearish momentum, the market could correct further or even consolidate in the coming weeks before being able to continue its upward trajectory.

sentiment analysis

By Edris Derakhshi (TradingRage)

Ethereum Taker Buy Sell Ratio

While the price of Ethereum has been struggling to continue its recovery and create a new all-time high, futures market sentiment analysis could provide useful insights into the potential reasons for this correction and whether it will end soon or not

This chart presents the Taker Buy Sell Ratio metric, which measures whether buyers or sellers execute their positions more aggressively as a whole, using market orders.

As the chart suggests, the 100-day moving average of Taker’s buy-to-sell ratio has been showing values ​​below one for over a year, and the metric is experiencing a massive drop. This indicates that the recent correction could be due to selling pressure coming from the futures market rather than the spot market, and as long as the metric is trending down, it will be difficult for the market to recover.

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