Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- ETH has a bullish market structure on the daily chart.
- The resistance above $2000, combined with the heatmap findings of liquidation levels, showed that a reversal was possible.
Ethereum [ETH] has risen sharply in the past three weeks and is up almost 25% in three weeks. News that Hong Kong is considering allowing exchange-traded funds (ETFs) that invest directly in cryptocurrencies, such as ETH, boosted investor sentiment.
Analysis of a whale’s trades in the past few hours revealed that a large amount of ETH left the Binance exchange. Was this a sign that smart whales continued to accumulate ETH?
The psychological level of $2000 could turn the bulls away again
Source: ETH/USDT on TradingView
On the one-day chart, market structure and momentum were solidly bullish. The RSI was at 74 to reflect the same, and the On-Balance Volume has been trending higher since mid-October. This underlined the fact that buying volume far exceeded selling volume over the past three weeks.
In the North, the next interest levels were at $2039 and $2141, marking the highs of July and April respectively. A look at the one-week ETH price chart revealed that the $1940-$2140 was a strong resistance zone, and has been since May 2022.
Therefore, an immediate breakout beyond this resistance zone was less likely to occur with a higher time frame, meaning ETH holders at lower prices could hold on to their gains and wait for the next move.
The massive liquidity pool of $2070 was an attractive bullish target
Source: Hyblok
The heatmap of Hyblock’s liquidation levels highlighted two areas that could be key for long-term investors. The first was the $2070 mark, which coincided with a resistance zone from the previous technical analysis.
A move just above $2070 to liquidate these positions could be followed by a reversal. The next major build-up of liquidations was below the low of recent months at $1485. Therefore, a visit to the $1500 area would likely be a juicy buying opportunity.
Source: Santiment
Read Ethereum’s [ETH] Price forecast 2023-24
The average coin age of 180 days continued to rise as ETH prices rose. This showed that holders have not yet started selling their ETH en masse. The dormant circulation metric has also not seen a notable spike in recent days, reinforcing this idea.
On the other hand, the MVRV ratio rose to a high not seen since July, meaning profit-taking activity could quickly pick up and trigger a turnaround. For that reason, ETH bulls can hold on to their gains and wait for the market to show where it is going.
