Ethereum [ETH] Faces Continued Weakness as Retracement Reverses Previous Gains

Ethereum [ETH] has recently seen a dip in its price, a phenomenon known as a retracement. This has resulted in a 2.70% decline over the past day.

Ethereum [ETH] price slipped on Monday, a phenomenon termed a retracement, clocking a 2.70% loss over the past 24 hours.

The downturn follows a 1.62% gain last week.

Chart: TradingView

Ethereum [ETH] witnessed a further decline in its price, clocking a 2.70% loss over the past 24 hours. The downturn comes amid a broader market downturn, with apex cryptocurrency Bitcoin [BTC] clocking a 1.02% loss.

The downturn saw ETH slip to $2,654.02 at the time of writing. However, the coin remained within a key support zone.

Ethereum [ETH] faces continued weakness

A glance at ETH’s technical indicators highlighted the lack of bullish signals, a factor that could contribute to a further decline.

The Relative Strength Index (RSI) was positioned at 58.15 and pointed toward a downtrend. This reading signaled a possible decline in price as ETH searched for a demand zone.

The Moving Average Convergence Divergence (MACD) remained in positive territory but showcased a significant decline in momentum. While the overall market health remained good, buying pressure appeared to be waning.

A key liquidity zone was highlighted between $2,536.47 and $2,484.44. If ETH price were to enter this zone, it could pave the way for a rally back to $2,820.92.

However, if ETH price fell through this demand zone, it could trigger a “stop hunt”—a strategy where traders attempt to gather additional liquidity before making a final upward push.

A sustained downtrend would indicate ETH’s entry into a bearish trend.

Traders eyed momentum in the ETH market. The market appeared to be searching for momentum, suggesting a possible decline from ETH’s current price.

Relative Strength Index (RSI): 58.15 (Bearish)

Moving Average Convergence Divergence (MACD): Clocking a downturn.

Open Interest: Clocking a 2.89% decline to $13.56 billion.

Coin Metrics highlighted a decline in Open Interest, to the tune of 2.89%, clocking in at $13.56 billion at press time. This reading suggested that traders were largely positioning themselves to short the asset.

If this trend were to continue, it would indicate that selling pressure may drive the asset lower, although it could still maintain a bullish market structure.

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