Ethereum continues its downtrend amid uncertainty

After successfully clearing $3,200, Ethereum violently re-entered, and a slow and painful decline began. Economic and geopolitical conditions continue to weigh heavily on global financial markets, and cryptocurrencies are a risky asset class (also called). risky), are not exempt from this overall decline. Let’s explore the key levels on this asset together in this new analysis.

This analysis of Ethereum price is brought to you in collaboration with: Coin Trading and algorithmic trading solution finally accessible to individuals.

Technical analysis

Ethereum vs USD

Ethereum vs USD

In terms of price action, it is relatively readable on Ethereum. We see the daily downtrend very clearly. Pits and hills are less and less high. We can confirm this with short-term moving averages. We also see the $3000 level very clearly as a significant pivot point, it acted as resistance but also as support in a few cases.

The $2,600 level should offer us some buy response due to its volume (often referred to as the HVN, High Volume Node). We will confirm this right away by enabling my favorite indicators i.e. moving averages and Volume Profile.

Ethereum is on the verge of hitting a key point at $2,600
Ethereum vs USD

By activating the moving averages as well as the volume profile, we can confirm that $2,600 represents a key point, a High Volume Node is there. So we can expect a buying reaction at this point.

Knowing that we are in a daily downtrend, you should take a quick take on a long position. We don’t want to stay long in a long position knowing the underlying trend is down, so place your profit (and stop loss) and don’t be too greedy!

The $2400 level, which we have been working hard on, does not represent a very important support level. There isn’t a lot of volume at this level and I wouldn’t dwell too long here!

I remind you that these analyzes aim to give you key points in the short or medium term. So, in the long run, I think the really interesting level to buy Ethereum is between $2,200 and $1,800, which represents an important weekly support.

Ethereum vs Bitcoin

Ethereum continues to be particularly strong against Bitcoin
Ethereum vs Bitcoin

Against Bitcoin, Ethereum is responding particularly well and remains in an interesting uptrend. The asset is in a weekly uptrend.

We’ve been on a channel between 77,000 satoshis and 73,000 satoshis for a few weeks. 66,000 Satoshi is the lowest point to be defended to avoid changing the underlying trend.

It is always interesting to observe the ratio against Ethereum. bitcoinMarket bottoms as it gives a state of health in Ethereum and accordingly.

Financial data, Order flow

Weekly Skin Profile.

Use volume levels in market analysis.
Weekly Ethereum Volume Profile

Here we see the “Volume Profile” chart of Ethereum in 1 week. I drew a green line, which is in line with the aforementioned thinking: the $2,600 level represents a large volume level.

This is how we can think of playing a short-term move at this level, playing with a quick profit as mentioned above. Below will be our main resistance level for you, the more experienced: an interesting short level.

I take advantage of the fact that I am talking about exposing Ethereum to remind you that exposing an asset is not as easy as being a buyer. We must start from this premise now: short gives you a limited expectation of profit for unlimited potential loss. Stop Loss is therefore even more important.

Open Interest

Open Interest is a relevant indicator for tracking where speculators are.
Open Interest, Hebdomadaire

There are a few things to add regarding Open Interest, which represents the amount of money that is continually injected into the markets.

These markets are often used to play short to medium term moves with leverage. We can see that respondents are now relatively calm but still have hope. Ethereum’s recent leg up to $3,600 was heavily supported by Open Interest and, accordingly, short-term speculators. However, we have not yet reached the Open Interest levels of July 2021, when fear was at its peak.

Options

Options, a widely used financial tool to protect yourself from the market
source : coin options

The next major option close will be on May 27, 2022, and around 336,000 Ethereum will expire.

Max Pain Price is $3,000 and therefore will be an important step to watch in the coming weeks. This is where most options traders will lose, and the price tends to retreat to this level in the past week until this expiration.

This maximum bread price may change in the coming weeks.

On-chain data

Net Unrealized Profit/Loss (NUPL)

Operators are worried

Here we see the Realized Profit and Loss chart which can be very relevant in understanding the psychology of traders. We can see that we are currently in a period of optimism and even anxiety. Therefore, we are still a long way from experiencing the long-awaited capitulation of long-term investors.

I use this slightly longer term section to remind you that current periods of fear are very good for starting a DCA and accumulating values ​​that interest you for several months or even years.

Ethereum 2.0 Staking

Ethereum 2.0 proves that the asset remains bullish over the long term.

We’re here to remind you that Ethereum is very bullish in the long run: 10% of the Ethereum supply is currently locked for the long-awaited Ethereum 2.0 update. This news shows that long-term investors continue to exist and continue to follow the project closely.

Currency Reserve

Supply decreases, which mechanically raises prices in the long run.

If we think very pragmatically, the market is just a game of supply and demand. With that in mind, I find it interesting to look at the reserves of exchanges that are constantly running out. So we can see that the supply is gradually decreasing, which is a bullish fact in the long run.

Currency Net Position Change

The trend of the speakers has been going on for a few years now!

As a result, this chart shows Ethereum going in and out of exchanges. Thus, we can see that the trend has accumulated for 2 years. We could not reach the high levels as in September 2020. That said, there is no reason to be downside about the long-term future of Ethereum. These charts prove that, many operators are accumulating Ether for the future and accordingly holding it in their portfolios, reducing the circulating supply.

Key levels

$3,000: Pivot point and unit node. It should act as a resistance.

$2,600: Large volume node in the demand zone. It should act as a support.

$2,400: The last support appears by price, not volume. Observed by many, but not necessarily an interesting place to buy.

$2 000 : Weekly support.

Ethereum, like any “risky” asset, economic and geopolitical dangers. The on-chain charts prove this to us: Ethereum is bullish for the long and very long term. Still, in the coming weeks and even the next few months, Ethereum should continue to suffer from the expiration of the “magic money” and the rise in rates.

If you’re a long-term investor, it’s time for DCA, but I’m not telling you anything. It would be interesting to strengthen this DCA at $2,200.

If you are a speculator, you need to make quick profits in an uncertain and above all very difficult market.

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