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After a massive price drop over the last two days, the cryptocurrency market has calmed down. ETH is now trading at a significant support level.
The weekend has been rather stable on the daily timeframe, after the bears forced the price down more than 10% in the previous two days.
Ethereum – Calm Before the Storm?
we can observe that selling pressure has eased in recent hours, implying that the Ethereum price will retrace later this weekend.
Over the last few days, the price of Ethereum has fallen further. ETH swiftly reversed and broke through prior lows after a climb to $2,950 on 4 May 2022.
As a result, the general trend remains gloomy. Bears, on the other hand, are exhausted as the market consolidates around $2,600.
Things had gotten worse for ETH, and the failure of a key support level suggests that a bigger drop is on the way.
Since January 22, the price of Ethereum has formed two higher highs and three higher lows, forming an ascending parallel channel when combined with trend lines.
The third retest of the channel’s lower trend line on May 2 was weak due to the absence of bullish volatility in Bitcoin price.
The FOMC crash on May 5 demonstrated that sellers may readily outnumber buyers and do so for an extended period of time.
As a result, the setup has been shattered, resulting in a bearish breakdown. The smart contract token’s immediate and last line of defense is $2,541. The conversion of this support into a hurdle might result in a 21% drop to $2,000.
While the Ethereum price is improving, a daily candlestick close above $3,000 will have overcome the 100-day SMA at $2,922, invalidating the negative thesis.
At the time of writing ETH is trading at $2,531 and has lost more than five percent in the last 24 hours.