Ethereum’s Bearish Tide and the Glimmer of a Bounce

Ethereum is currently navigating a period of significant bearish pressure, with its price action today reflecting a struggle to maintain footing above the psychological $3,900 support level. A comprehensive review of the technical indicators yesterday painted a starkly bearish picture on the shorter timeframes, a sentiment that has largely carried over into today’s session. Initial analysis showed the price consistently trading below key DEMA levels across the 2-hour to 1-day charts, with indicators like the MACD and DMI confirming strong downward momentum. However, a deeper dive, incorporating more nuanced observations, reveals a more complex dynamic at play.

While the overarching trend remains bearish, we are now witnessing what appears to be a weak bounce attempt. On the 2-hour chart, for instance, the MACD is curving upwards over its signal line, and the RSI is attempting to reclaim the 50-midpoint. Yet, this nascent bullishness is undermined by a distinct lack of volume, as evidenced by a nearly flat CMF reading, suggesting the rally is more “hot air” than a genuine reversal.

This pattern of fragile, unsupported bounces repeats across the 4-hour and 6-hour charts, where bullish SRSI signals are contradicted by overwhelmingly bearish MACD, DMI, and volume indicators. The daily chart reinforces this bearish outlook, with the price having decisively broken its uptrend structure and indicators showing significant room for further downside before becoming exhausted.

The weekly chart, however, offers a sliver of hope, as the long-term uptrend remains structurally intact. The weekly MACD is still strongly positive, and the DMI confirms that bulls have not yet ceded long-term control. This creates a fascinating technical crossroads: a market dominated by short-term sellers, but with underlying long-term strength that could fuel a powerful reversal.

Based on historical price behavior, a strong bounce from the $3,900 support region remains a distinct possibility. The immediate strategy is to remain cautious, respecting the current downtrend by trailing stop-losses on any short positions, while staying vigilant for a confirmed, volume-supported bounce from this critical support zone that could signal the end of the current correction.

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