December 29, 2021 / Analytics

Ethereum Price Analysis: ETH/USD To Reduce By A Third

ethereum forecast

Unfortunately, the New Year’s miracle has not happen on Ethereum (ETH) cryptocurrency market, and the asset rate began to drop. Therefore, ETH/USD should fall to $3,500 by January 5.

Key Points

  • ETH price is trading below the 100-hour moving average ($4,008).
  • A bearish trend line has formed on the hourly chart with resistance at $4,075.
  • The nearest support barrier is at $3,760.

Ethereum rate began to dump again on December 27. During the day, the coin price decreased by 9% and broke through the shrinking triangle that has been forming since the beginning of December. During the last round of the bearish trend, the virtual currency rate dropped to $3,760 – 50% Fib, taking into account the pump from $2,656 to $4,868.

The coin price bounced off this obstacle, but with a high probability over the next two sessions, sellers will storm the $3,760 barrier. In this case, ETH will fall in price to $3,500 (61.8% Fib). If the bears fail to overcome this barrier, then the asset rate will rise to at least $3,900 – the downward trend line that emerged on December 1 will pass through this mark.

eth chart

Ethereum Price To Reduce By A Third

Given the width of the broken triangle, ETH rate should decrease by 34% to $ 2,500 in the medium term. Thus, in January, the value of the coin can update the bottom fixed at the end of September ($2,651).

Elliott’s wave theory also speaks in favor of a downward trend, because after wave C, Ethereum exchange rate corrected, but then began to fall again. In addition, almost all peaks were lower than the previous ones, and the emerging bullish trend quickly fizzled out.

eth chart

Of particular concern is the trend associated with an increase in trading volume during the dump and a drop in this indicator during the pump. Moreover, traders sold a lot of coins on Tuesday. Taken together, these factors indicate the continuation of the bearish trend. Taking into account the chart data, it becomes obvious that buying ETH in the range above $3,500 carries too high risks.

Technical indicators:

  • 4 hours MACD is in the bearish trend zone.
  • 4 hours RSI is above 20 (in the neutral area).
  • The main support level is $3,500.
  • The main resistance level is $4,000.
  • The nearest pivot points are $3,838 and $3,990.
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