Ethereum recorded an increase of over 11% last week after crossing the $3,500 threshold. Let’s examine the future outlook for ETH together.
State of Ethereum (ETH)
After testing the $3,300 zone, the Ethereum price continued its rise, reaching new highs. At the time of writing, one Ether is trading at over $4,000. Thus, the Ethereum price has crossed the 78.6% Fibonacci retracement level, calculated from its all-time high. In other words, Ethereum is now just a few hundred dollars from its record high. The bullish scenario mentioned in our analysis of March 6 has thus materialized. Namely, this last level was reached following a rebound from $3,700.
Naturally, Ethereum continued its bullish trend. This idea is confirmed by the maintenance of its price above its 50-day moving average. Similarly, Ethereum’s bullish momentum persists, although one can note a slight weakening through the oscillators.
The current technical analysis has been conducted in collaboration with Elie FT, an investor and trader passionate about the cryptocurrency market. Now a trainer at Family Trading, a community of thousands of independent traders active since 2017. Here you will find Live sessions, educational content, and support around financial markets in a professional and warm atmosphere.
Focus on Derivatives (ETHUSDT)
We can observe that the open interest for ETH/USDT perpetual contracts outperforms its price, indicating growing speculative interest. Given the current trend of its price, predominately buyer liquidations during short-term declines, and the positive funding rate associated with Ethereum, it is easy to deduce that this interest mainly comes from the buyers’ side. However, it is important to note that a high funding rate in the derivatives markets can increase the costs of long positions and encourage short positions, thereby increasing volatility and the risk of liquidations.
The ETH/USDT liquidation heatmap over a week reveals that the cryptocurrency is just below a significant liquidation zone, located precisely above $4,100. The price’s approach to this level could trigger a massive activation of orders, thus increasing the risk of a period of heightened volatility for Ethereum. This area therefore represents a crucial point of interest for investors.
Potential Scenarios for Ethereum’s Price (ETH)
- If Ethereum’s price holds above $3,900, we could anticipate a bullish continuation up to the $4,200 level. The next resistance to consider if the bullish move continues would be $4,400. At this stage, it would represent an increase of more than +8%.
- If Ethereum’s price fails to maintain above $3,900, a retracement to $3,700 might be envisioned. The next support to consider if the bearish movement continues would be around $3,500. At this stage, it would represent a decline close to -13%.
Conclusion
Ethereum has confirmed its uptrend by breaking through the 78.6% Fibonacci retracement level, coming closer to its all-time high. Could this enthusiasm be due to the EIP-4844 upgrade? What is certain is that it will be crucial to closely observe the price reaction at different key levels to confirm or refute the current assumptions. It is also important to remain vigilant against potential “fake outs” and market “squeezes” in each scenario. Finally, let’s remember that these analyses are based solely on technical criteria, and the cryptocurrency prices can also rapidly evolve based on other more fundamental factors.
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Family Trading est une Communauté de traders a compte propre active depuis 2017 offrant Lives, contenus éducatifs et entraides autour des marchés financiers dont celui des cryptomonnaies avec à ses côtés Elie FT, investisseur et trader de passion sur le marché crypto.
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