Disclaimer: These findings are solely the author’s opinions and should not be regarded as investment advice.
- Ethereum has a bullish market structure
- But, the momentum and buying pressure did not indicate that a rally was imminent.
On 15 September, Ethereum merged with Bitcoin. This was almost three months ago. Since then, ETH has not been able to surpass the $1650 resistance. The bulls were also not favored by the on-chain metrics. Losses of around 20% were reported for the past month, ranging from $1646 – $1264.
Read Ethereum’s Price Prediction 2023-2024
The coming days will be a challenge for Ethereum bulls. There was no strong buying pressure yet, and Bitcoin faced resistance at $17.3k and $17.6k. To justify their conviction, buyers will need to move above $1360 in the next weeks.
The breakers on each side hint at where Ethereum might find a large number of buyers or sellers
Source: TradingView ETH/USDT
Over the past six week, two breakers have been formed in the $1.360 and $1.200 zones. These breakers are highlighted in cyan/red and are bullish and beary respectively. They were once bullish and bearish order blocks respectively, but the price has since broken through them.
At the time this article was written, ETH had neutral momentum for the daily timeframe. The Relative Strength Index, (RSI), was at a neutral fifty while the 21 and 55 period moving averages showed bearish sentiment for ETH. However, the market structure was positive. This occurred on 30/11/17 when the price broke the $1217 mark. It broke the string of lower highs it has reached since 9 November.
The On-Balance volume (OBV), which was also flat in November, showed that Ethereum was still under buying pressure. Traders can sell ETH at $1360, and then buy it at a retest price of $1217. Resistance can also be found in the $1300-$1315 region for shorter timeframes.
Although the funding rate falls below 0 for withdrawals, it shows accumulation
Source: Santiment
Binance’s funding rate had been positive for the past few days. This indicated that futures market participants were bullishly placed, but this changed in the recent hours. Ethereum’s failure to break above $1300 swayed the sentiment of lower timeframe traders.
Investors were likely accumulating ETH because of the rapid rise in withdrawal transactions. These addresses are used for withdrawing the asset from central exchanges. However, they could have been transferred into cold storage. A large outflow was not observed in the exchange flow balance, as it was on November 21. That was ETH’s local bottom.