Ethereum’s recent market performance has seen an unexpected and sharp rejection from the $1.8K resistance level, triggering a significant downward trend that broke down both the pivotal 100-day and 200-day moving averages. This development is a clear, bearish signal for Ethereum’s mid-term prospects.

Technical Analysis

By Shayan

The Daily Chart

Following a notable drop from the critical $1.8K resistance zone, Ethereum’s price dipped below the critical 100-day and 200-day moving averages, roughly around the $1.8K mark. Yet, the price ultimately found support at a significant level of $1.6K, initiating a bounce.

This support zone holds precise significance as it’s also the 61.6% Fibonacci retracement level, corresponding to the recent impulsive upward move towards the $2.1K mark in early March.

However, this initial rebound was followed by another impulsive downward movement, again touching the crucial support zone at $1.6K. While this price action does indicate a noticeable bearish sentiment in the market, it’s essential to recognize that the potential revival of support could set the stage for another possible bullish bounce.

Such a rebound could potentially shift the market into a consolidation phase. Contrarily, if the price drops below the $1.6K mark, the possibility of a bearish cascade becomes increasingly likely.

The 4-Hour Chart

Looking at the 4-hour timeframe, it becomes evident that the downward trajectory was momentarily halted when Ethereum reached the substantial $1.6K support region. This indecision led to a brief consolidation phase marked by low volatility. However, the price experienced a sudden surge (the Grayscale pump), marked by the emergence of a substantial green candle.

However, buying pressure weakened as the price ascended and approached the critical 61.8% Fibonacci retracement level, prompting a reversal. Consequently, the price embarked on another impulsive retracement, driving it back towards the $1.6K range. Furthermore, Ethereum has formed a bearish continuation flag pattern, and it is currently attempting to breach the lower boundary of this pattern.

Because the $1.6K threshold holds significant psychological importance, if sellers successfully push the