ETH/USD broke lower, extending beneath $3k as Bitcoin saw fresh losses on negative market sentiment
Ethereum has fallen below critical support in the $ 3,000 demand zone after experiencing a 5.5% decline in the past 24 hours. The downturn for ETH came as Bitcoin (BTC) also pared recent gains with a 3% dip to test prices around $42,150.
The price outlook for Ethereum suggests bears could push prices further, with a breakdown likely to see ETH / USD hit a low of $ 2,650. On the other hand, an upside flip could feature a daily close above $3,000 to open up fresh bids targeting highs of $3,500 in the week.
Ethereum technical outlook
The daily chart shows ETH / USD is above the 0.5 Fib retracement level as the bulls look for further momentum towards the critical $ 3,000 barrier. The 100 SMA ($2,763) offers an important buffer zone, indicating a daily close above an emerging rising trendline is possible.
In this case, the target on the upside would be to reach the 0.618 Fib ($ 3,143) level and then push towards the supply area near the 50 SMA ($ 3,298). Turning this zone into a support level could see an influx of buy orders targeting $3,500 (a key supply reload zone currently found near the 0.786 Fib level).
The 4-hour chart for Ethereum shows ETH / USD is below the simple moving averages of 50 and 100, with sloping lines in the indicators suggesting further downward pressure. The RSI dipping below the equilibrium line also adds to the potential for new losses.
From a technical standpoint, buyers are likely to push higher if they turn the area around $ 2,871 into support. This is an area marked by the 0.5 Fibonacci retracement level of the macro move from $1,717 to $4,025.
If the price of ETH drops from here, it could see further lows towards another horizontal anchor line around $ 2,763. If the price falls further, the next support could be at 21 September 2021 lows around $2,650.
According to technical analyst Michael van de Poppe, the correction below $ 3,000 for Ethereum suggests that the outlook for 2021 may reflect the price trajectory of 2017. In this case, ETH is still bullish long term even with a potential extension of the downside.
