Main Highlights
- Ether (ETH) saw an 8% price decrease on Tuesday, reaching $3,940 and leading to over $115 million in long ETH liquidations.
- Despite the recent dip, some market analysts remain optimistic about ETH’s upward potential, provided key support levels are maintained.
- Technical analysis suggests a potential bull flag pattern on the weekly chart, pointing to a possible target of $10,000 if current support at $3,800 holds.
Ether (ETH) experienced a significant downturn on Tuesday, with its price falling by over 8% from Monday’s peak of $4,300 to trade at $3,940. However, market sentiment suggests that optimism for ETH’s price appreciation persists as long as crucial support levels remain intact.
Market Impact: Over $115 Million in Long ETH Positions Liquidated
The recent bearish price action for Ether coincided with substantial liquidations across the broader cryptocurrency market. Data from CoinGlass indicates that over the past 24 hours, more than $650 million in leveraged crypto positions have been liquidated, with long positions accounting for $455 million of that total.
Long Ether liquidations specifically reached $114.5 million at the time of reporting, highlighting how traders who were betting on price increases were caught off guard by the dip below the $4,000 mark. The largest single liquidation event involved an ETH/USD pair valued at $5.5 million on the OKX exchange.
💡 This level of liquidation often signals a temporary shakeout of overleveraged positions, potentially clearing the way for a more sustainable price movement.
The CoinGlass liquidation heatmap revealed significant buying interest below the current spot price, with approximately $743 million in bid orders situated between $3,670 and $3,800. This suggests that the recent correction might find a floor around these levels.
✅ Understanding these support zones is critical for traders looking to identify potential entry points or areas where selling pressure might subside.
Assessing Ether’s Uptrend Prospects
Market analysts posit that Ether is currently undergoing a technical correction, retesting key support levels before a potential resumption of its upward trend.
Michael van de Poppe, founder of MN Capital, noted that the ETH/BTC pair reached an ideal zone for buys at 0.032 during Sunday’s decline. He expressed optimism for a trend reversal, stating that ETH is ready for a trend switch and needs to establish a higher low to push towards new highs.
“$ETH hit the ideal zone for buys and I think it’s ready for a trend switch,” van de Poppe wrote in a Tuesday X post, adding: “It needs a higher low and then we’re off toward new highs.”
⚡️ The ETH/BTC pair often serves as a vital indicator for the relative strength of Ether against Bitcoin, offering insights into broader altcoin market dynamics.
Another analyst, Daan Crypto Trades, confirmed that the 0.032 level has held firm, emphasizing that a crucial breakout above 0.041 is necessary for the ETH/BTC pair to sustain its uptrend.
In analyzing the ETH/USD pair, Titan of Crypto highlighted that the relative strength index (RSI) has broken out of a multi-year downtrend, signaling a potential significant breakout. Based on fractal patterns observed in July 2020 and Fibonacci levels, Ether’s price could target between $8,000 and $10,300 if the current bullish momentum continues.
“#ETH breakout is loading…”
Pseudonymous analyst Chimp of the North suggests that Ether’s downside might be limited to $3,800. Their analysis indicates that ETH could retest the $3,800 support level before potentially rallying towards $5,000 and beyond.
📌 Keeping an eye on the RSI can help gauge the momentum behind price movements and identify potential overbought or oversold conditions.
Ether’s Bull Flag Pattern: A $10,000 Target?
From a technical standpoint, ETH is currently consolidating within a bull flag pattern on the weekly timeframe. This bullish chart formation typically occurs after a sharp price increase, followed by a period of consolidation within a downward-sloping channel.
Ether is presently retesting the lower boundary of this flag, which is around $3,870, acting as immediate support.
The resolution of this bull flag pattern hinges on ETH breaking above the upper trendline, projected at $4,440. Such a breakout could propel the cryptocurrency towards the pattern’s technical target of $10,050, representing a potential gain of 164% from its current price.
📊 A breakout above the upper trendline of a bull flag often signals a continuation of the prior uptrend, while a breakdown below the lower support could invalidate the bullish pattern.
Conversely, the RSI has declined to 54 from a high of 74 over the past seven weeks, indicating that the current correction might extend as profit-taking persists. A daily close below the $3,800 support level could expose Ether to further declines, potentially targeting the 20-week simple moving average (SMA) at $3,700, followed by $3,500.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
Fundfa Insight
While Ether has experienced a notable price correction and liquidations, the underlying technical indicators and analyst sentiment suggest a potential for recovery. The critical $3,800 support level appears to be a key area to watch, and a sustained break above resistance levels could signal a continuation of the bullish trend, with ambitious targets projected by some market watchers.