Ethereum, frustrated at the $2,400 barrier... eventually entering a bear market?

▲ Ethereum (ETH)

Ethereum (ETH) is facing strong downward pressure after failing to break through the technical resistance level of $2,400 four times.

According to a report by virtual asset media outlet Cointelegraph on April 27 (local time), Ethereum's price recently formed a triple-top pattern on the daily chart, turning bearish. Since April 14, Ethereum has failed to surpass the $2,400 mark and has fallen, trading below its 100-day moving average. Virtual asset analysts interpret the repeated failures to break the resistance level as strong absorption of supply by sellers, indicating a rapid weakening of short-term upward momentum.

Ethereum's price decline is also evident in its relative weakness against Bitcoin. Michaël van de Poppe, founder of MN Capital, pointed out that the ETH/BTC pair, the price ratio of Ethereum to Bitcoin, fell below 0.032 BTC, losing a key support level. Poppe predicts that Ethereum is likely to fall further to the next support level of 0.026 BTC in a higher timeframe. This suggests that Ethereum's market dominance is weakening as asset inflows in the market are concentrated on Bitcoin.

Futures position indicators within the market also support the downside risk. Currently, Ethereum's open interest on Binance exchange has fallen to $2.58 billion, showing a massive liquidation of leveraged positions. The funding rate also recorded -0.013%, plummeting to its lowest level since February. With short positions dominating the market and increased liquidation risk for long positions, downward price pressure is maximized.

From a technical perspective, Ethereum's fate hinges on whether it can hold the $2,150 support level. Analyst Amr Taha warned that approximately $2.5 billion worth of long position liquidations are concentrated around the $2,150 mark. If the price fails to hold this support level and breaks down, forced selling could trigger a sharp drop in price to the range of $2,050 to $1,900. Currently, Ethereum is navigating between support and resistance levels, preparing for extreme volatility.

The movements of the Ethereum Foundation and whales are also contributing to market anxiety. Despite a 10% price increase throughout April, evidence of the Ethereum Foundation selling its holdings has been detected, dampening investor sentiment. Market participants unanimously agree that a cautious approach is necessary until the imbalance between on-chain data and futures indicators is resolved. Ethereum stands at a critical juncture, having to overcome the double challenge of technical resistance and large-scale liquidation risk.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*