The sharp price collapse in the ETH market has become a big problem for its investors. In fact, since 20 February, sellers have managed to lower the ETH price by almost 40%. Sellers met with serious resistance in the range of $1260-1360 and were forced to temporarily retreat.
In the previous article, we wrote that we expect a minimal correction in the ETH market in this range.
Having broken the bottom trend line, which buyers confidently have been keeping since 11 January, sellers have called into question the all-time high update in the near future:
High Volumes in ETH Market Exacerbate the situation
As we see in the chart, trading volumes during the price fall since 22 February are high. Buyers received the main blow on 22-23 February. This is noticeable both in terms of volumes and aggressive candles.
Then for 7 days, the ETH price fell by inertia without the support of strong sellers. The result of such a fall was a good price rebound from the liquidity zone of $1260-1360 today. However, the main question remains open – will the price correction in the ETH market continue?
The maximum possible correction at the moment can end at $760. The precondition for such a strong collapse of Ethereum may be a failed attempt by buyers to fix above the range of $1770-1870:
Owning the Range of $1770-1870 Can Rule ETH market
On the chart, we noticed several trading situations that confirm the importance of this range. If sellers intend to continue the downward trend in the ETH market- the range of $1770-1870 will be their foothold.
At the moment, on the 4-hour timeframe, we see good volumes for ETH buyout, which may have a positive impact on the new growing trend of buyers.
Although, if we see a decrease in trading volumes as the price approaches $1770-1870, it will be a good signal of a new potential wave in the ETH market.
If we analyze the ETH dominance chart among other cryptocurrencies, we see a clear decrease in interest in the coin since early February:
The dominance indicator returned to 12%. As you can see in the chart, in the past for quite a long time the dominance indicator could not pass the blue range.
An indicator return below the critical range may be a negative signal for continued ETH market correction.
Therefore, while the price is below the trend line of the growth channel and the range of $1770-1870, sellers will dominate in the market.