ETH/USD broke lower, extending beneath $3k as Bitcoin saw fresh losses on negative market sentiment
Ethereum has dipped below the critical support of the $3,000 demand zone after seeing a 5.5% downside in the past 24 hours. The downturn for ETH came as Bitcoin (BTC) also pared recent gains with a 3% dip to test prices around $42,150.
The price outlook for Ethereum suggests bears might still push prices lower, with a breakdown likely to see ETH/USD reach lows of $2,650. On the other hand, an upside flip could feature a daily close above $3,000 to open up fresh bids targeting highs of $3,500 in the week.
Ethereum technical outlook
The daily chart shows ETH/USD is above the 0.5 Fib retracement level as bulls seek new momentum towards the critical $3,000 barrier. The 100 SMA ($2,763) offers an important buffer zone, indicating a daily close above an emerging rising trendline is possible.
In this case, the upside objective would be to reach the 0.618 Fib level ($3,143) and then push for the supply zone near the 50 SMA ($3,298). Turning this zone into a support level could see an influx of buy orders targeting $3,500 (a key supply reload zone currently found near the 0.786 Fib level).
ETH/USD daily chart. Source: TradingView
The 4-hour chart for Ethereum shows that ETH/USD is below the 50 and 100 simple moving averages, with the sloping curves of the indicators suggesting further downward pressure. The RSI dipping below the equilibrium line also adds to the potential for new losses.
From a technical point of view, buyers are likely to push higher if they turn the area around $2,871 into support. This is an area marked by the 0.5 Fibonacci retracement level of the macro move from $1,717 to $4,025.
If ETH price breaks lower from here, it could see fresh declines towards another horizontal anchor line around $2,763. If the price falls further, the next support could be at 21 September 2021 lows around $2,650.
ETH/USD 4-hour chart. Source: TradingView
According to technical analyst Michael van de Poppe, the correction below $3,000 for Ethereum suggests the 2021 outlook could mirror the price trajectory of 2017. In this case, ETH is still bullish long term even with a potential extension of the downside.