Ethereum Price Analysis: Key Resistance Level to Watch for $3K Challenge

Ethereum is showing signs of a strengthening bullish trend as it rebounds from a crucial support level. The cryptocurrency is now approaching a significant resistance area aligned with the 100-day moving average (MA). If ETH can break through this resistance, it may pave the way for a sustained upward movement.

Technical Analysis Overview

Daily Chart Insights

Ethereum recently experienced increased buying pressure around the mid-trendline of a multi-month descending channel, approximately at $2.4K. This surge in demand led to a notable rebound in price, pushing it towards the resistance zone around $2.6K, which coincides with the 100-day MA.

• A successful reclaim of this MA could signal a new uptrend for Ethereum.
• If this bullish scenario unfolds, the next targets could be the 200-day MA at $2.9K and the upper boundary of the descending channel near $2.8K.
• Conversely, if Ethereum faces rejection, it may retrace to the $2.4K support level for consolidation.

4-Hour Chart Analysis

On the 4-hour chart, Ethereum's rebound near the $2.4K area, particularly around the lower boundary of an ascending flag, indicates a short-term rise in demand. The price has now reached a critical resistance zone, corresponding to the 0.5 and 0.618 Fibonacci levels ($2.6K-$2.8K), where substantial selling pressure is expected.

• Ethereum's price remains within a narrow range, supported by the flag's lower boundary and resisted by the Fibonacci levels.
• A breakout above this range could trigger a short-liquidation cascade, potentially driving the price towards the $3K mark.

On-Chain Metrics

Recent price movements have sparked renewed bullish sentiment in the Ethereum market, reflected in the funding rates metric. This metric gauges the balance of buyers versus sellers in the futures market, with positive funding rates indicating bullish sentiment.

• Currently, funding rates are slightly positive, suggesting a shift towards optimism among futures traders.
• However, these rates remain lower than those observed during March, indicating that while bullish sentiment is growing, it has not yet reached the intensity required for a significant breakout.

For Ethereum to overcome key resistance levels and maintain an upward trajectory, an increase in funding rates would signal heightened buying interest and confidence among futures traders, potentially leading to a more sustained rally.