After facing rejection for several weeks and experiencing a series of bearish developments, the price of Ethereum reached a critical point near a pivotal support area. This includes the 61.8% Fibonacci retracement level.

Fortunately, the price returned from this crucial zone, providing hope amidst the prevailing bearish sentiment. This rebound also indicates the possibility of a temporary consolidation phase.

By Shayan

Ethereum’s price has been in a prolonged downtrend, breaking multiple support levels, including the crucial 100 and 200-day moving averages. As a result, Ethereum reached a multi-month low at $1,531. However, at this point, Ethereum’s price encountered a critical support zone, spanning the range between the 50% and 61.8% Fibonacci retracement levels.

Despite this, market participants see this range as the final defense for Ethereum bulls. If the price drops below this threshold, it could increase the likelihood of a significant downward plunge.

In addition to these bearish signals, the 100-day moving average crossed below the 200-day moving average, forming a death cross event, which is a strong bearish signal. However, despite these bearish indicators, there is still hope that the price could find support and enter a consolidation phase, moving around the 200-day and 100-day moving averages.

Shifting our focus to the 4-hour timeframe, we can see that Ethereum’s price underwent a consolidation phase between the $1.6K-$1.8K price range. During this period, a bearish flag pattern formed, and eventually, the price broke below the lower trendline of the flag, triggering a significant downward movement.

However, as Ethereum approached the critical support level at $1.5K, buying pressure intensified, leading to a rebound. This resulted in a retracement towards the lower threshold of the broken flag, potentially forming a pullback. If this pullback occurs successfully, it could indicate the start of another downward phase, aiming to break below the $1.5K mark.

On the other hand, if the price fails to complete the pullback and instead breaks above the