- Ethereum has developed a descending triangle on its four-hour chart.
- If the $1,720 support level continues, Ethereum could rally up to 25%.
- Conversely, if Ethereum breaks its support, a drop to $1,300 is likely.
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Ethereum remains stable in a non-trading zone that is shrinking over time. It is advisable to be patient until ETH gets out of pocket at this tight price.
ethereum at a crossroads
Traders seem to be getting impatient as Ethereum continues to consolidate within a tight price range.
Data from Coingglass shows that around $1.5 billion in long and short ETH positions have been liquidated across the board over the past three weeks. Meanwhile, Ethereum has been locked in a no-trading zone that seems to be shrinking over time. The token’s price action has defined two important price points that will determine where the price is headed next.
Ethereum has developed a descending triangle on its four-hour chart. This technical structure prevails that a break below the X-axis or above the hypotenuse can result in a 25% price movement in either direction. A sustained close below $1,700 or above $1,900 ETH could resolve the current ambiguity.
A break below support could lead to a drop to $1,300, while overcoming resistance could encourage sidelined investors to re-enter the market and push Ethereum towards $2,270.
Despite the unclear technical outlook, on-chain data shows that many large Ethereum whales are exiting their positions, indicating fears of further downside.
Data from Glassnode shows a 1.51% drop in the number of addresses with balances over 10,000 ETH in the past three weeks. Roughly 18 whales have either left the network or redistributed their holdings. Although this amount may seem insignificant at first glance, it is worth noting that each of these addresses holds at least $20 million worth of ETH.
This increase in selling pressure from whales could be tampering with Ethereum’s ability to rally. Nevertheless, a decisive four-hour candlestick outside the $1,700-$1,900 no-trade zone could help determine which direction ETH will head in the coming weeks.
Disclosure: At the time of writing, the author of this article holds BTC and ETH.
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