Ethereum Price Under Red Alert As Bearish Sentiments Rise

The Ethereum price struggles near the $1600 resistance level, increasing the likelihood of a bearish reversal to test the buyers at the $1427 horizontal zone. Furthermore, a bearish pattern rising in the daily chart warns of a sharp correction phase in the upcoming weeks. So, should you consider booking profits early or continue to buy above $1500?

Key points Ethereum price analysis: 

• The increased selling pressure at the $1600 level results in an evening star pattern. 
• The breakdown of the $1427 support level can drop ETH prices to $1259. 
• The Ethereum Fear and Greed Index has dropped to 32% mark

Source-Tradingview

In the daily chart, the Ethereum price displays a power struggle at the $1600 support level teasing a potential bearish turnaround. The evening star pattern at the said resistance level reflects an increased bearish influence over the underlying sentiments.

Furthermore, the higher price rejection candles at the 50 and 20-day EMA reflects an increased underlying selling pressure. And the declining trend in the intraday trading volume near the resistance level projects a loss of buyer’s interest. 

Also read: Explained: What Happens To Ethereum (ETH) Holdings During And After Merge?

Additionally, the larger picture displays a head and shoulder pattern forming with a neckline at the $1427 horizontal zone. And with the potential bearish turnaround completing the bearish pattern, a support breakdown possibility may shortly result in a sharp decline in Ethereum prices. 

Thus, the bearish breakdown of the $1427 horizontal zone can result in a price drop to the next support level at the $1260 mark. 

However, if bulls can keep the Ethereum price floating about the $1427 demand zone, a prolonged lateral trend is possible below $1600. 

Technical indicator-

The DMI indicator displays a lateral trend within the DI lines, reflecting a choppiness in the underlying sentiments.  

RSI indicator mimics the bullish failure as the ETH price forecast a turnaround from the $1600 support level.

A bearish crossover between the 20-and50-day EMA encourage more sellers in the market.

• Resistance level- $1600 and $1730
• Support level- $1427 and $1259