Ethereum (ETH/USD) is currently trading in a corrective phase after its previous rally failed to hold above $4,000. The cryptocurrency hovers near $3,100, sitting below its 20-week EMA (~$3,357) and 50-week EMA (~$3,257), signaling short-term weakness.
However, it remains above the 100-week EMA (~$3,014) and well above the 200-week EMA (~$2,615). This setup suggests that while near-term momentum has cooled, the broader trend remains constructive, as long as price respects the 100–200 EMA support zone.
The rejection around $4,200 indicates strong selling even at higher levels, but ETH is just pulling back and not rejecting the overall trend. It’s a normal kind of pullback and not a panic-selling situation. The volatility levels are decreasing, with historical volatility for 10 weeks around 47. That’s expected for the sideways markets.
On a structural front, Ethereum is consolidating between levels of $2,950-$3,400. Ethereum has tested the top line a few times but has seen resistance. The demand line for the 100 EMA has prevented prices from sinking further.
However, a weekly closure above the 20-50 EMA would mean that buyers might regain control of the market. A breach of the current levels of $2,950 would increase the possibility of a fall to the 200 EMA of $2,600 levels, which are critical for long accumulation.
Ethereum Shows Wyckoff Accumulation Pattern
Ethereum’s current pattern appears to be the type of Wyckoff Accumulation pattern described by Crypto Tice. The marketplace is absorbing supply quietly while distributing weak market participants through market cycles, while maintaining strong support levels.
In the history of such accumulation phases, the building of market momentum may take several weeks to build before the giant players begin their sustained trend.
The Wyckoff strategy involves a number of procedures. Phase A marks a pause in the previous decline in the Selling Climax and the Primary Test. Phase B demonstrates a sideways storage of the commodity in large quantities, with the price challenged frequently but restrained.
Phase C employs a planned Spring below the level of the supporting price to rout the weak speculator. Phase D showcases true strength in the breakout above the resistance levels, while Last Points of Support are formed on the decline.
The price action on Ethereum is currently in line with the end of Phase D. What this implies is that the market may be gearing up for a stronger positive trend, in which the previous resisters can now provide strong support.
