Ethereum (ETH) has been alternating between good and bad without giving a clear direction since the end of January. On the one hand, one could agree that he is not doing so badly given the risks posed by the Russian-Ukrainian conflict. But on the other hand, the current trend remains bearish since its last ATH in November 2021, despite the price stability of the past few weeks.
There remains the feeling that the prince of cryptos is struggling to extricate himself from a price zone. A lethargy seems to be setting in and with it, some anxiety on the part of investors. So what are the key levels to watch for a possible surge in Ethereum in one direction or another?
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Table tennis inside the Kumo in weekly units
Even though Ethereum’s movements remain volatile, it is clear that there is very little animation with regard to the last three weekly candles (including this week’s) that remain inside the Kumo (cloud ). Although it is not so bad compared to the current context on the financial markets.
However, ETH prices are trading below the Tenkan and Kijun respectively, with the Ichimoku curves likely to reverse momentum in the short-medium term. At the same time, the Chikou Span, which is certainly above the Kumo, continues to fall towards the support around $2300.
Since the week of January 24, we observe the inability of Ethereum to tame the Tenkan. To embarrass cryptocurrency investors, it failed below major resistances around $2800 and $3400. At the time of writing, the prince of cryptos is seriously approaching his lows from last January, the $2300 support. The latter is to be watched closely, as it is located at the level of the lower limit of the cloud, the Senkou Span B (SSB). And if the headwind prevails, ETH prices would find themselves below the Kumo. This would gradually lead us towards a neutralization of the underlying trend since the end of March 2021.
Closer to returning to $2300 support than to rallying $2800 resistance
This is the hot observation that I make on the daily chart of Ethereum. I know it’s not going to thrill some readers, but technical analysis invites us to be humble. The Prince of Cryptos failure to stay inside or breach the Kumo coincides with both the failures under major resistances mentioned previously and the failure to cross the downtrend line since its last ATH. To complete the panel of negative technical signals, the position of the Chikou Span in relation to the cloud does not encourage optimism.
If the awakening were to take place at this time, we should instead look down towards the $2300 support. In the event of a fall below this level, we would risk reconnecting with the support of $1800, which served as the fulcrum of the last upward wave towards its last ATH near $4900.
As for the reverse scenario, rallying the resistance around $2800 and going beyond it would involve crossing the downtrend line and the Kumo. Which would be no small feat.
In summary, the awakening of Ethereum in one direction or another, will undoubtedly depend on the next movements of Bitcoin combined with a concrete advance in the Russian-Ukrainian conflict. As long as geopolitical uncertainty persists and BTC does not break resistance around $46,000, investors better stay on the sidelines.
Although the prince of cryptos surprisingly manages to stay afloat, we would hope that this is not the calm before the storm. If in daily units, it is not glorious from a graphical point of view then what about the prospect of the significant thickness of the Kumo and the Kijun at the resistance level of $3400 in weekly units which would prove to be major obstacles for an upward trend reversal. Thus, even getting rid of the resistance at $2800 would not be decisive enough to turn the tide.
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