Today’s recovery marked an extension of the rally in which Ethereum was caught up in time following its decline in the U-100 region in mid-March.
Analysts are increasingly concerned about the strength of its recent upward trend as it has not retested its previous resistance levels as support – which means it could be positioned to review these levels short term.
Ethereum Reaches Local Heights Approaching Major Supply Zone
At the time of this writing, Ethereum is trading just under 1% at its current price of $ 189.40, marking a noticeable increase from its daily lows of $ 184 which had been set during a decline fleeting last night.
The cryptocurrency is now in a consolidation phase just below its current resistance at $ 190. This level happens to be where he rallied last Saturday before facing a strong rejection here.
A popular pseudonym analyst focused on Ethereum on Twitter recently offered a graph showing that the main supply area for crypto exists just below $ 200 – which means it could be the level it rallies to before facing a potentially grueling sale.
“Fatigue is developing on ETHs near the major supply. The timing will be important, but the underlying problem is starting to show up, “he said, pointing to the graph below.
If Ethereum is unable to garner enough buying pressure to exceed this level, it could be a disastrous sign that reveals underlying weakness among its buyers.
ETH’s failure to confirm previous resistance levels as support is a grim sign
In addition to facing a heavy air supply area that could hamper its price action, the cryptocurrency also did not confirm its previous resistance levels as support throughout its recent uptrend.
This has led another popular crypto trader to note that it seems likely that his previously intense resistance levels will be retested in the short term.
“An incredibly strong recovery here, at almost 30% of the local fund. – However, genuinely concerned about these resistance levels that have never been tested as a support – the rules are rules, the gaps always end up closing, “he said.
Unless Bitcoin continues to push higher and allows Ethereum to break its air supply area, it is possible that this is enough to trigger the decline that has led ETH to retest these previous resistance levels in the days and weeks to come.
Featured image from Unsplash.