Ethereum Price Rejection at 200-MA: A Deeper Correction on the Horizon?
Ethereum’s price has repeatedly rejected the 200-day moving average (MA) at $3,400, indicating strong dynamic resistance and increasing the likelihood of a deeper correction towards the $2,500 support zone. This rejection is a significant development, as it suggests that the cryptocurrency’s price may be poised for a further decline.
The 200-MA has proven to be a formidable obstacle for Ethereum, with two consecutive rejections at this level. This dynamic resistance is a key indicator of the market’s overall sentiment, and its inability to break above it has become a defining feature of the current market structure. As a result, the price has pulled back, triggering selling momentum and pushing Ethereum back into a downtrend.
Key Technical Points
Several key technical points are worth noting in this context. Firstly, the major resistance at $3,580 corresponds to the Fibonacci retracement of 0.618 and forms a textbook sub-high zone. This zone is likely to act as a strong confluence area where many traders expect a lower high to form. Secondly, the main support level is at $2,500, which is in confluence with the Value Area Low (VAL) of the current market profile. This level is likely to be retested if bearish momentum continues.
ETHUSDT (1D) chart, source: TradingView
Ethereum’s inability to break above the 200 MA has significant implications for its price. The compressive effect of the 200 MA is becoming increasingly clear, with sellers remaining in control and bullish attempts lacking the strength to sustain a breakout. This environment often precedes a downward extension of volatility, particularly when both macroeconomic trends and market structure are bearish.
Volume Dynamics and Market Structure
Volume dynamics also support the view that a deeper correction is likely. Recent attempts to break above the 200 MA were met with bearish volume, while seller reactions appear to be more aggressive. This imbalance reinforces the expectation that a continuation of the downtrend remains more likely than a sudden reversal. Furthermore, Ethereum’s broader chart still reflects a macro downtrend, with lower highs forming with each asset rally. These failed rallies are often corrective rather than impulsive, signaling exhaustion rather than accumulation.
In conclusion, Ethereum’s price rejection at the 200-MA is a significant development that suggests a deeper correction may be on the horizon. With bearish pressure prevailing as long as the price remains below the 200-MA, a deeper correction towards the $2,500 value area low is looking increasingly likely. For more information, visit https://crypto.news/ethereum-price-rejects-200-ma-deeper-correction-unfold/
