Ethereum fell below $3,715 but did not go below the next support level of $3,575.
Ethereum falls, but crypto markets remain weak.
As the crypto market continues to fall, Ethereum has lately fallen to multi-week lows under the $3,575 support level. Most main currencies have been under pressure in the previous 24 hours as traders shifted cash out of the crypto segment in the last days of 2021.
There is no clear cause for the latest shift, however it should be noted that Bitcoin’s recent drop below the critical $50,000 milestone has harmed market sentiment.
Bitcoin Dominance, which measures Bitcoin’s market value as a percentage of overall crypto market capitalization, is still hovering around 40%. A drop below 40% may give support for other cryptocurrencies, notably Ethereum. However, it should be highlighted that for Ethereum to have long-term upside, overall crypto market value must increase.
Ethereum’s Price Is Declining
The daily chart reveals that each effort to recover from the November and December pullbacks was thwarted at lower levels, indicating that Ethereum is in a bearish trend. Unsurprisingly, Ethereum dropped below the 20 and 50 EMAs and proceeded to fall.
Currently, Ethereum is attempting to settle below the $3,715 support level. If Ethereum falls below this level, it will face another challenge of the next support level, which is situated at $3,575.
A fall below $3,575 will bring Ethereum towards the $3,400 support level. If Ethereum falls below this level, it will fall to the next support level at $3,275. A successful test of this support level will bring Ethereum closer to the $3,170 support level.
A rise over $3,715 will pave the door for a test of the resistance at $3,900. If Ethereum rises over this level, it will face resistance at the $4,000 mark. Because the 50 EMA and the 20 EMA are so close together, Ethereum will almost certainly find material resistance at this level.
Looking at the H1 chart, we can see that Ethereum swiftly recovered from the support level of $3,575, but the RSI has returned to the moderate range, indicating that there is still plenty of opportunity for more bearish momentum in the near term if crypto markets stay under pressure.