As recently as 2 weeks ago, the Ethereum market showed good growth prospects and strong buyers’ positions.
In the previous article, we wrote that buyers managed to win $1530 and increase the probability of continued growth up to $2900. However, even today buyers are struggling to survive and maintain the growth trend.
The main reason for the ETH price sharp correction, which began with the beginning of the new trading week, was the BTC market fall. In just one day, the BTC price fell by 15%, testing the mark of $48,255.
An unexpected correction for many Ethereum market participants called into question the strength of buyers and the strength of the trend line:
Buyers’ Initiative Provokes a Correction in ETH Market
The sluggish ETH price growth during February, which had every chance to accelerate the trend of buyers, was a great opportunity for sellers to start the correction.
The current black trend line, which buyers have been skillfully keeping since 11 January, protects the price from failure in the range of $1260-1360. As you can see in the chart, it is in this range that the ETH price slowed down significantly in January 2020.
It is this range that should show whether the Ethereum market is ready to continue the growth trend.
Main Scenarios of Ethereum Price Action
If we look at the situation realistically, the correction of the frantic Ethereum price growth is as necessary as air. Due to the large number of investors who bought ETH and are waiting for a profit, the price slowed down significantly.
The temporary downward trend in the ETH market will restore the balance of buyers’ strength, allow other investors to enter the market, and test the strength of the main liquidity zones.
Looking at the weekly timeframe, the minimum correction to the range of $1260-1360 should happen.
This range also includes the previous historical high, which could be a good starting point for a new wave of growth.
Though, given that there has been no significant correction in the ETH market since March 2020, we are thinking about the deeper wave of fall.
The signal of such a scenario will be a sluggish rebound from the range of $1260-1360 and reduced trading volumes. In this case, we expect a breakout of this range and the continuation of the fall wave to the mark of $700-760.