In a tense context, where the market impatiently awaits the changes that the Trump administration could bring, holders of digital assets are showing excitement. Ether is no exception, tipping below key levels.
Uncertainty and negative biases on Ether
It is Friday January 10, 2024 and the price of ETH is moving around $3,200.
Our last technical analysis of Ethereum dates back to Friday December 22, 2024, when the price of this cryptocurrency was moving around $3,350. Since then, the crypto has, in accordance with one of our hypotheses, revisited the $4,000 zone, with an outcome that sent it lower again.
The wait is long for ETH token hodlers, who have suffered a loss of relative strength against Bitcoin since September 2022. Their hope now rests on Ether's ability to attract institutional capital via US spot ETFs.
This idea is supported not only by the possibility of the establishment of yields linked to staking if the legal framework were to be clarified under the mandate of Donald Trump, but also by a historic rotation which, until now, has been always operated during phases of upward cycles.
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On the derivatives market side, open interest on Ethereum has never been higher. New DeFi protocols, such as Ethena, which generate yield using funding fees, make these markets more difficult to understand.
However, in the short term, the bias seems bearish: open interest has increased while the asset has corrected by 12%. This suggests a build-up of liquidity on the way down, particularly above $3,700, which could signal explosive upside potential if the asset manages to find a low point soon.
Still in 2nd position in the ranking of cryptocurrencies, with a capitalization of $390.88 billion, the ETH token continues to leave its most fervent supporters wanting more. But where are we, technically, on this asset?
| Pairs with Ethereum | 24 hours | 7 days | 1 month |
| Ethereum/USDT | -2.30% | -7.10% | -14.30% |
| Ethereum/Bitcoin | -1.40% | -4.70% | -8.80% |
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Ethereum, the low point or the fall?
Under the catalytic effect of the election of Donald Trump, Ethereum crypto had crossed the pivot of $2,800, extricating itself from a zone that can be characterized as a deviation. To maintain a bullish orientation in the short and medium term, this hypothesis should not be questioned.
Indeed, this zone can be revisited during an excess or a hunt for liquidity, by a brief movement of a few days. However, settling there permanently by chaining weekly closes would significantly degrade the chart and validate a reintegration of the range between 2,000 and 2,800 dollars.
While it is early to consider the breakout of this major pivot, the currently bullish 50-week moving average provides key support. If this support were to give way, it could mark the start of a retracement towards $2,800. This historic level, in confluence with the 0.382 Fibonacci retracement (calculated from the bear market lows to the 2024 high), could then provide a potential point of support for price action.
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However, the asset has shown signs of weakness in recent days, crossing downward the level of $3,344. This threshold represents the confluence of several Fibonacci retracements :
- 0.236 from bear market lows to 2024 high,
- 0.618 from the 2021 all-time high to the 2022 bear market low.
The recovery of this level is crucial to rework the rebound scenarios more favorably. In the absence of a rapid recovery, Ether could cross the December 20 low, thus marking a change in weekly trend, a signal favoring a medium-term correction.
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Daily ETH price chart
In summary, Ethereum is showing signs of weakness, unable to rebound effectively during its latest correction. The weekly trend nevertheless remains bullish as long as the December low is not crossed. However, Ether must recover quickly to avoid a more marked reversal.
So, do you think ETH can outperform the crypto market again? Don't hesitate to give us your opinion in the comments.
Have a nice day and we'll see you next week for a new technical analysis of Ethereum.
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Sources: TradingView, Coinglass, GlassnodeETF
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Investments in cryptocurrencies are risky. There is no guaranteed high return, a product with high return potential involves high risk. This risk-taking must be in line with your project, your investment horizon and your capacity to lose part of this savings. Do not invest if you are not prepared to lose all or part of your capital
Analyst at Cryptoast Research for several years, I carry out in-depth monitoring of the crypto market to analyze the next narratives while keeping an eye on the financial markets.
Emmanuel Lazaro
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