Positive news that Ukraine and Russia may soon reach an agreement boosted the cryptocurrency market. The price of Ethereum had touched the psychological resistance level of $3,500.
The second-largest cryptocurrency by market capitalization was trading above $3,400 for the third straight day, but positive momentum has declined as market uncertainty has increased.
Over the last two weeks, the top two crypto assets Bitcoin and Ethereum have shown a significant increase. They’ve risen almost in lockstep, adding more than 28% in market value. A sharp correction, on the other hand, could be on the way.
The likelihood of a temporary drop rises when Ethereum trades below this important barrier level. According to a tweet from Bitcoinsensus, Ethereum could face resistance at $3.4K and then bounce back to $3K to form the first higher low.
Ethereum price analysis
For the third day in a row, ETH traded above $3,400, before hitting a reverse, indicating that more bulls were still holding positions in ETH than in BTC.
As of this writing, ETH is down 3.4 percent, with an intraday low of $3,277, somewhat higher than yesterday’s low, although the price of the coin has remained constant over the last day.
Near the $3,450 level, ETH is seeing resistance. The next major resistance level might be near $3,500, after which the price could surge to $3,650.
On the downside, support could be found near the $3,250 level. The next key support is near $3,150, which the bulls may find difficult to overcome in the near future.
At the time of writing Ethereum is trading at $3,249 and has declined by more than three percent in the last 24 hours. The coin has gained more than eight percent in the last seven days.
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Source: https://coinpedia.org/ethereum/this-is-why-ethereum-eth-price-might-plunge-to-3k-before-massive-rally/