Ethereum, the second-largest cryptocurrency by market capitalization, witnessed another drop in price after an unsuccessful attempt to cross the $3,650 resistance level. The popular cryptocurrency suffered a strong negative reaction around this mark and followed a similar path to Bitcoin, dropping below the key level of $3,550 and testing the $3,320 support zone.
The sudden drop caused Ethereum to break through the key supports at the $3,500 and $3,450 levels and drop significantly to a low of $3,324. However, exhibiting the inherently volatile nature of cryptocurrencies, Ethereum is currently showing signs of a wave of recovery, rising just above the $3,360 level. Currently, the cryptocurrency is floundering around $3,500 and trading below its 100-hour simple moving average.
Ethereum price’s immediate resistance lies around the $3,400 level, which is almost the 23.6% Fibonacci retracement level from the significant drop from the $3,654 to $3,324 lows. If Ethereum manages to break through the first major resistance and threatening trendline near the $3,420 level, another scary ledge awaits at $3,450. An estimated surge above this point would result in Ethereum exploring the 50% retracement level of the aforementioned decline.
Observers believe the next front will emerge around the $3,520 mark and the 100-hour simple moving average. A breakout of this resistance could inject bullish momentum into Ether traders, making the $3,650 threshold a target for speculation. If Ethereum succeeds in breaking through this resistance, the bullish outlook toward the $3,720 zone could gain momentum. Further gains could even increase the chances of his precious $3,880 test.
However, there are many challenges to the development of Ethereum. If the price fails to break through the $3,420 resistance level, further decline is expected. Due to downward pressure, Ethereum price could once again approach the $3,320 support level. If this support does not hold, Ethereum could slide towards major support around the $3,250 zone.
A further break below this level could pull Ethereum dangerously close to the next key support level at $3,220. A decisive drop below this support could trigger a scary drop to the scary $3,120 level. Any further losses could force Ethereum’s price to fall to an alarming level of $3,040.
Ethereum technical indicators are currently predicting a bearish outlook. The MACD on the Ethereum hourly chart is losing momentum in the bearish zone. Meanwhile, Ethereum’s hourly RSI is currently languishing below the median 50 level.
In summary, Ethereum’s near-term trajectory is uncertain, bouncing between the resistance level at $3,420 and the major hurdle of support fixed at $3,220.
