Ethereum (ETH) Faces Critical Test at $3K Support Level

• Ethereum slipped to $3.1K, gaining by over 2%.
• With a shift in market sentiment, ETH could rally towards the $3.5K mark.

The bullish sentiment of the crypto market drove the overall market cap to climb past $3 trillion, surging over 5%. While Bitcoin (BTC) trades at $91,627, Ethereum (ETH) cannot mirror its upward momentum. With fading bullish signals, the ETH price risks its price. 

ETH hovers at a crucial trading juncture, facing downside corrections while testing its support and resistance levels. The asset has registered a modest gain of 2.85% over the past 24 hours. ETH might trade to the downside today as the negative trend persists.

At press time, Ethereum trades at $3,136. The asset has sunk to a low of $3,016 and later rose to $3,142. In the meantime, the market observed a liquidation of $36.12 million worth of Ethereum. Along with this, the daily trading volume of ETH stays at $30.73 billion. 

Moreover, from the weekly outlook, Ethereum shows a spike of over 3.29. The asset began trading at $3,043 and has entered a bullish pattern. ETH has managed to trade at $3,417, suggesting the possibility of an Ethereum breakout. 

Is Ethereum at Risk of Falling?

The four-hour price chart of ETH suggests the current downside correction, with Ethereum facing pressure to hold critical price levels. The altcoin is trading just above the crucial support level at $3K. A failure of bulls to conquer bears may cause the price to decline further toward $2,876. 

On the flip side, if the market sentiment renewed, ETH might regain momentum at $3,328. This recovery could likely push the Ethereum price to climb potentially toward its peak at the $3.5K mark.

Moreover, ETH’s existing sentiment is neutral within the market, as the daily relative strength index (RSI) is resting at 50.17. Besides, the short-term 50-day moving average of the altcoin is found above the long-term 200-day moving average. 

While inferring the technical indicators of the ETH/USDT trading pair, it exhibits ongoing negative sentiment as the Moving Average Convergence Divergence (MACD) line settles beneath the signal line. This likely hints at a possible continuation of the bearish trend.

In addition, the Chaikin Money Flow (CMF) indicator is at 0.01, suggesting the money flow is on the positive side. If the indicator rises, it could signal an upside correction. Meanwhile, ETH’s daily trading volume has dropped by over 12.25%.

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