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- The lower timeframe momentum and structure favored ETH bulls.
- The presence of strong resistance above meant that short sellers could find an opportunity next week.
Ethereum [ETH] bulls were able to defend the $1840 support in recent days and managed to push prices past $1900. While this was encouraging for lower timeframe bulls, there was the possibility that a foray to $2000 would see ETH rejected.
Read Ethereum’s [ETH] Price Prediction 2023-24
A confluence of technical factors suggested that the $2010-$2070 area was likely to offer stern resistance to bullish advances. Although Ethereum has traded within a range from $1800-$1965 recently, it appeared that a false breakout followed by a rejection was a likely scenario in the coming days.
Range highs or FVG or breakout past $2000?
The MACD formed a bullish crossover and pushed above the zero line as well. This showed strong bullish momentum, although the trading volume has been below average in the past few hours. Although ETH saw a retest of both the range highs and lows, the market structure was bullish since the price did not form a lower low.
There was a significant area of resistance at the $2025-$2150 area. An imbalance on the H4 chart was highlighted in white, and a bearish order block was directly overhead as well. Hence, a possible scenario in the coming days was the near-term bullish momentum forcing a bullish breakout toward $2000, followed by a rejection from the bearish OB.
Another scenario that could unfold for Ethereum was a rejection from the range highs directly, but the presence of the imbalance above meant it was likely to attract the prices before reversal. The idea of rejection from the $2100 area can be somewhat risky for bears. This was because a breakout past the $2000 psychological level could see a rapid shift in sentiment and heavy demand could drive prices higher, with short liquidations fueling the rally as well.
Therefore, risk management would be extremely important.
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Lower timeframe bias was bullish due to significant demand
The one-hour chart from Coinalyze showed that the spot CVD has formed higher lows since 22 April. Despite the sharp pullback on 26 April, the CVD advanced higher. This indicated that ETH buyers were stronger and pointed toward a short-term rally.
The Open Interest showed that bullish speculators were not as enthusiastic as spot buyers. The OI rose noticeably over the past couple of days but remained in a downtrend, if we consider the past ten days.