Ethereum Approaches Pivotal $2,400 Test Amidst Bullish Challenges, Analysts Sound Warning

Author : Elisabeth Louise | Published On : 22 Jan 2024

Ethereum (ETH) is undergoing a crucial test of its resilience as it confronts the $2,400 support zone, according to insights shared by Crypto Tony, a prominent crypto analyst. Despite Ethereum's recent bullish momentum and strong recovery, there is a shift in market sentiments, with sellers gearing up for prominence, especially in anticipation of impending Bitcoin Halving events.

Crypto Tony, in a recent post on the X platform, underscored the critical importance of Ethereum maintaining the $2,400 level. This level, according to the analyst, holds the key to Ethereum's future trajectory, serving as a make-or-break point for the digital asset. The ability to stay above $2,400 will either reinforce the ongoing bullish trend or open the door for bears to take control.

Into the Block data reveals that a significant portion of Ethereum holders, precisely 77.39% of addresses, are currently in a profitable position. However, caution is advised, as 20.51% of addresses face losses, having bought Ethereum at higher prices.

Examining the daily chart, buyers seem to be in control within a rising channel, but concerns arise with a potential double top at the overhead trendline, signaling a potential retest of the $2,400 breakout. Despite a 2.45% decline and $28 million in long liquidations, Ethereum remains resilient at $2,472.

The weekly RSI trend remains positive, approaching the overbought boundary. Yet, a bearish divergence in the last two peaks suggests a brief pullback for trend correction. Buyers may see the $2,400 level as an entry opportunity, employing a buy-low, sell-high strategy. On the flip side, a breach below $2,400 could trigger a price decline, targeting the psychological mark of $2,000.

Crypto Tony's cautious analysis adds a layer of awareness to Ethereum's current market dynamics, urging stakeholders to closely monitor the $2,400 level. As the cryptocurrency market undergoes shifts, the next few weeks will be instrumental in gauging Ethereum's ability to withstand potential challenges.