Ethereum prices have slumped this past week after a failed breakout attempt earlier in January. However, the second-largest cryptocurrency by market cap continues to cling to a key support zone even as bearish momentum builds.
ETH sits around $2,470 following a 10% fall from monthly highs of $2,717. Still, the token has thus far maintained the pivotal horizontal support spanning $2,400–$2,500 that could determine its next major move.
Bullish traders eye that area as critical to preventing a potential plunge back toward the $2,000 threshold. More reactive sellers see that level failing to inspire much confidence in exhausted upside momentum after ETH’s months-long rangebound action.
— IncomeSharks (@IncomeSharks) January 18, 2024
Ethereum RSI shows sharp downtrend
Oscillators like the relative strength index (RSI) reflect the tense uncertainty around the near-term direction. While still above 50, the RSI has trended sharply downward in recent weeks in a potential bearish divergence, signaling fading upside energy.
Intraday charts reveal Ethereum coilings into an even tighter range bound by solid support and resistance. ETH recently bounced off a descending wedge pattern that could imply an upward breakout is nigh.
However, buyers have repeatedly failed to overcome selling pressure with any strength. That leaves Ethereum caught in the crosshairs of rival bulls and bears vying for technical control.
The stalemate means further directionless chop is likely in store, barring a catalyst-driven burst in either direction. For now, analysts broadly expect rangebound consolidation between around $2,400 and $2,700 until a more decisive trend takes shape.
Of course, that could change rapidly if highly fragile broader crypto sentiment sees a sentiment shift. For Ethereum bulls, only a daily close above the recent swing high of $2,717 signals upside interest remains intact rather than further deterioration.
Inversely, bears need a close below $2,400 to open the door to more significant capitulation, fueling a drop toward the critical $2K figure.