Ethereum Price Analysis: Declining Volume Sparks Doubts on $3000 Breakout

The Ethereum price analysis showcased a fresh relief rally in the second week of July. The bullish reversal uplifted the asset from monthly support of $2825 to $3196 registering a weekly gain of 13.2%. This recovery followed a market excitement towards the potential approval of spot ETH ETFs in the coming week and eased from broader market supply. Is the correction trend over?

Also Read: Bitcoin & Altcoins In Focus As Market Eyes Ether ETF, Fed Chair Comment, & Other Events

Ethereum Price Analysis: Will Spot ETH ETF Approval Propel ETH to $4000?

The mid-term trend from the Ethereum price analysis shows a sideways action in the daily chart. The formation of a new lower high at $3974 and recently the same swing low at $2815 projects ETH price entering a consolidation trend to recuperate exhausted bullish momentum.

A recent reversal from the $2815 support has uplifted the asset to $3191 within a week while the market cap jumped to $383.5 Billion. However, the declining volume accompanying the upswing suggests a diminishing interest among market participants to initiate long positions.

This lack of conviction from buyers suggests an unsustainable recovery and a potential for further correction in ETH. If the coin price reverts from the overhead trendline (downsloping blue line), the sellers could rechallenge the $2815 floor to extend the current correction.

The potential breakdown could accelerate the supply pressure and push the asset to $2400.

However, the potential approval of spot ETH ETF could counter the bearish thesis to change market sentiment.

Also Read: Ethereum Price To Hit $5,000 As ETH ETF Speculation Ignites Bullish Comeback

Nate Geraci, President of the ETF Store, recently tweeted that the SEC’s approach to the spot Ethereum ETF S-1 filings closely mirrors their handling of the 19b-4 filings, marked by significant discretion. Geraci remains optimistic about the approval, anticipated next week, emphasizing that there is no justifiable reason for any delay.

It appears the SEC is playing the spot eth ETF S-1s similar to the 19b-4s…

*Extremely* tight-lipped.

Still think approval next week. Absolutely no reason for delay.

— Nate Geraci (@NateGeraci) July 12, 2024

Thus, the potential approval could intensify the buying momentum and propel the ETH price prediction target above the $4000 mark.

Technical Indicator

• EMAs: The 20-day and 50-day Exponential Moving Averages (EMAs) serve as dynamic resistance levels during a bullish upswing, signaling a strong downward momentum in progress.
• RSI: The Relative Strength Index (RSI) reverted to 45% indicating a neutral sentiment among market participants.