Will Ethereum Return to the $1400 Price Mark in Coming Days?

Ethereum is facing a huge sell-off after the rejection from a key resistance level. Will Ethereum return to the $1400 price mark in the coming days or not?

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Jay Crypto

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Last updated Oct 1, 2022 at 11:34 AM

Posted Sep 30, 2022 at 09:00 PM

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We will look at why Ethereum is facing selling pressure along with the possibility of the asset returning to the $1400 levels. Let’s get going!!

What's the Current Market Outlook?

The merger was finished by Ethereum on September 15, 2022. Although the merger was highly anticipated by the cryptocurrency world, it appears to have let down crypto whales, as Ethereum's price movement went bearish after the announcement.

Investors appear to have cashed out prior to the merger, as CryptoRank reports ETH transactions totaling more than 1.7 million ETH. The likelihood of Ethereum's sentiment becoming bearish is indicated by this string of sell-offs.  

A few days ago, Ethereum saw a severe rejection from the range highs at $1400. Ethereum also saw a negative pattern in a lower period like the significant decline that Bitcoin experienced.

The Merge happened in the middle of September, and since then the price has declined. Transaction costs have decreased, although  this decrease may not be entirely attributable to the Merge and may instead reflect a decline in interest in the NFT domain.

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CoinMarketCap

The ETH/USD image from CoinMarketCap shows that the asset is currently trading around major resistance of $1337 with daily gains exceeding 2%.  Ethereum returned to its bullish stance by adding more than 3% to its trading volume. The weekly gains of ETH are more than 6%. 

Let’s look at several other factors to analyze the asset’s performance in the ecosystem. We will then look at the technical analysis to check whether  Ethereum will return to $1400 levels or not.

The Ethereum Network is Growing 

In the last two weeks, some on-chain measures have increased dramatically. Around the time of the Merge, the daily active addresses metric increased dramatically. Over the past several days, Ethereum's network expansion has also accelerated, approaching a height that it hasn't, however, been able to cross since May.

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Santiment

For Ethereum, the Long-Short ratio for the previous 24 hours has been interesting since it demonstrates that short positions had the upper hand. According to the recent seven-day negative financing rates, Ethereum futures markets remained strongly bearishly positioned. 

Ethereum's most significant flaw, despite being one of the most well-known blockchains, was its astronomically high transaction fees. Consider this: Between January 2021 and May 2022, the Ethereum network charged an average gas fee of around $40 per month, with the highest average daily gas price of $196.638 occurring on May 1.

But after the Merge, these considerations seem to have lost all relevance. It has supposedly gotten much more affordable to transact with Ethereum. According to data from The Block, on September 22 Ethereum's transaction costs were at their lowest point for the previous two years.

What’s Next?

According to the pricing charts, a range between $1400 and $1240 has developed. The Value Area High and Low were shown by the Visible Range Volume Profile to be at these levels, respectively. At $1327, the Point of Control served as a significant resistance obstacle.

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TradingView

In addition, at the time of writing, the $1300–1340 range constituted a former support area that was retested as resistance. The swing high and low that was produced last week (yellow range) closely matched the results of the VPVR. Therefore, if the mid-range is rejected, ETH would probably drop back to its $1240 lows.

The price produced a lower high, while the RSI made a higher high, signaling a concealed bearish divergence as the RSI was trading below the neutral 50 levels.

This might indicate that the recent downward trend will continue. Recently, the A/D line has risen to indicate some purchasing pressure. The CMF, however, is yet to indicate a sizable capital inflow into the market.

Conclusion

With $1340 acting as firm resistance, another move lower appears imminent based on ETH's price activity. A potential short squeeze could emerge if the hourly session closes over $1340 and the short-term bias changes. Ethereum's return to the $1400 level or not depends on several factors. Any fundamental event in the ETH ecosystem will nullify this analysis. DYOR!!

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