Is ETH on the verge of a deeper correction towards $2.7k?

Ethereum price has been falling recently, after a second rejection of the $4,000 resistance level, and has yet to recover.

Technical Analysis

By TradingRage

The daily chart

On the daily chart, the price has been making lower highs and lower lows since it failed to break the $4,000 level on the upside some time ago. The market has also fallen below the 200-day moving average around $3,100.

Currently, the price is retesting the 200-day moving average, but seems to be rejected to the downside. As things currently stand, it seems likely that the cryptocurrency will fall towards the $2,700 support level in the near term.

Source: TradingView The 4-hour chart

The 4-hour chart shows an extended view of recent price action. As is evident, the downtrend has recently intensified to the downside, with the market briefly breaking below the $3,000 support level.

However, after an oversold signal from the RSI, the price has recovered above the aforementioned support zone. However, the price seems to lack the momentum to continue higher and could be on the verge of a deeper drop towards the $2,700 area.

Source: TradingView On-Chain Analysis

By TradingRage

Ethereum Exchange Reserve

During Ethereum’s downtrend in recent weeks, many analysts have been looking for capitulation signs that point to a possible bottom. Some signs become obvious.

This chart shows the Ethereum Exchange Reserve metric, which measures the amount of ETH held in exchange wallets. An increase shows potential selling pressure, while a decrease indicates a decrease in supply.

After the recent brief dip below the $3,000 level, the currency reserve metric has seen a rise above its 30-day moving average. This could signal the beginning of the capitulation phase, as many investors’ stops were below the $3,000 level.

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