Ethereum has faced a downward trend despite positive developments, such as introducing Ethereum Spot ETFs in the U.S. Over the past week, Ethereum (ETH) has dropped by 6.62%, and analysts are predicting a possible continuation of this downtrend.
Analyst Predicts 80% Ethereum Price Surge if Key $2,200 Support Holds
According to analyst Carl Runefelt, ETH is trading within a falling wedge pattern. This pattern often signals a significant price rally after a decline. Runefelt has identified the $2,200 support level as a critical point. Historically, when the price reaches this level, buying pressure increases, leading to a potential price rebound.
Runefelt believes that if ETH bounces from this support level, it could rise by 80.47%, pushing the price to nearly $4,000. He stated,
“Once a breakout occurs, there’s a strong possibility #Ethereum could rise back to $4K.”
Key Ethereum Support Levels Identified: $2,218 and $2,281 Crucial for Potential Reversal
According to AMBCrypto’s analysis, the In and Out of Money Around Price (IOMAP) tool indicates that $2,218.93 serves as a crucial support zone. At this price level, more than 1.59 million ETH is currently held in profit. As a result, if the price dips to this point, it could trigger significant buying pressure, potentially stabilizing the market.
The IOMAP data suggests that Ethereum might not need to fall as low as $2,218.93 for a reversal. A reversal could occur around $2,281, where 2.17 million buyers hold a total of 1.01 million ETH. This range is another critical area to watch.
Bearish Signals for Ethereum as Short Positions Increase and Funding Rates Drop
Despite hopes for a rally, data from Hyblock indicates a bearish trend. The cumulative liquidation level delta shows that there are more short positions than long positions, indicating negative market sentiment.
Additionally, the OI-weighted funding rate, tracked by Coinglass, has dropped from 0.0043% on September 4 to 0.0023%. This drop reflects that retail investors are driving ETH’s price lower, increasing the likelihood of a further decline toward the $2,200 support zone.
The open interest (OI)-weighted funding rate, tracked by Coinglass, measures the cost of holding a leveraged position in the futures market. A positive rate indicates that long positions are paying shorts, and a negative rate suggests the reverse. A drop in this rate, from 0.0043% on September 4 to 0.0023%, suggests that fewer traders are willing to pay a premium to maintain long positions, signaling weaker demand for buying Ethereum.
This decline implies that retail investors, often more sensitive to market movements, are becoming less confident in ETH’s price, driving it lower. As selling pressure mounts, Ethereum’s chances of continuing its downward trajectory toward the key support level at $2,200 increase.
Ethereum Live Price, Market Data, and Performance Overview
As of September 6, 2024, Ethereum (ETH) price is trading at $2,370.79, showing a 0.7% decrease over the last 24 hours. The price movement falls within a 24-hour range of $2,328.73 to $2,410.62.
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