Falling Volume Hints The Ethereum Price Correction Is Temporary; Buy Now?

The Ethereum price is currently going through a minor correction and stalls its prevailing recovery phase. From the $1300 mark, the altcoin has tumbled 3.5% and shows a high possibility for further downfall. If the selling pressure persists, the sellers could retest a recently breached resistance of $1220 as a possible support, but will the price sustains above this support?

Key points: 

• A higher price rejection candle at $1275 resistance suggests a prolonged downfall
• A potential down to $1220 will bolster buyers to replenish the bullish momentum.
• The intraday trading volume in Ethereum is $5.1 Billion, indicating a loss of 6.5%. 

Source- Tradingview

A V-shaped recovery from the $1100-$1080 support surged the Ethereum price 20% higher to $1300. This bullish rally bolstered buyers to surpass some significant resistances, such as $1160, $1220, and $1275.

Furthermore, the buyers tried to sustain above the $1275 support over the past three days but failed miserably when the price plunged below it on December 3rd. Thus, the bearish engulfing candle triggers a minor correction in Ethereum’s ongoing recovery.

As of today, the ETH price is currently trading at $1257, with an intraday of 1.35%. However, the long-wick rejection attached to the daily candle indicates the price sustainability below the $1257 mark.

With sustained selling, the altcoin may plunge another 3% to retest the $1220 support. Moreover, this downfall, backed by decreasing volume, indicates the ongoing correction is temporary.

Thus, the $1257 support aligned with the 0.382 Fibonacci retracement level offers a strong footing to resume the prior recovery.

On a contrary note, the daily candle closing below the $1257 support will weaken the bullish thesis.

Technical indicator-

Relative Strength Index: the daily RSI slope failed to sustain above the neutral line, indicating uncertainty among market participants.

EMAs: the 50-day EMA assisted the sellers in reverting the prices from the $1300 mark. Moreover, the downsloping 100-and-200-day EMA accentuated an overall downtrend.

Ethereum intraday price levels

• Spot price: $1256
• Trend: Bullish
• Volatility: Medium
• Resistance level- $1375 and $1500
• Support level- $1220 and $1160