Ethereum Futures forecast
For traders and investors seeking strategic entry points, here’s a deep dive into Ethereum’s price action, key support levels, and what lies ahead after last week’s volatile moves.
Weekend Recap: Ethereum’s Decline and Key Insights
📉 Ethereum Futures dropped nearly 16% from its recent highs, driven by Bitcoin’s dance around the $100,000 mark. Liquidity hunts caused over $500 million in long liquidations between Thursday and Friday.
Despite the decline, Ethereum’s long-term bullish structure remains intact. Here’s why:
- Bullish Flag Breakout in August: Ethereum rallied above its bull flag and closed the gap at $3,000—a psychological price magnet.
- New All-Time Highs: On December 6, Ethereum Futures touched $4,142.50, surpassing March 2024’s $4,138.50 high. This validates the flagpole’s target.
- Profit-Taking Pullback: Recent profit-taking is expected after hitting those highs.
Current Support Levels to Watch 🔑
Ethereum has key institutional levels to monitor for potential dip-buying opportunities. Here’s a breakdown:
1️⃣ Value Area Low (December 9th) – $3,559
- This is the line in the sand for buyers.
- Institutions and algos are likely eyeing this level as a critical test of support.
- If it holds, expect a rebound to retest recent highs.
2️⃣ Value Area Low (November 26th) – $3,223
- If $3,559 fails, $3,223 is the next critical level.
- This area aligns with institutional interest and high-volume activity.
- A dip here could provide a strong entry for longer-term buyers.
3️⃣ Naked Value Area Low (November 15th) – $3,070
- Should $3,223 break, this level becomes an even better buying opportunity.
- Its significance comes from being untested, making it a high-probability reversal zone.
Strategic Notes for Traders
🛠️ Here’s how I approach these levels:
- First Test Bounce: Watch for a bounce at $3,559 to confirm buyer strength. If it fails, focus on $3,223.
- Tight Stops: Keep stops tight—e.g., at $3,246—when entering a long near $3,223 to manage risk.
- Build a Layered Position: Use these levels to set staggered buy orders for a net entry strategy.
What’s Next? Ethereum’s Longer-Term Bullish Case
Despite the short-term pullback, Ethereum remains in a bullish long-term trend, targeting $5,000 with patience. Here’s why:
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Historical VWAP Reactions:
- Ethereum is trading near a VWAP from June 2022, a level that has acted as major support in the past.
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Institutional Profit-Taking vs. Accumulation:
- Institutions often take partial profits near recent highs, as seen at $4,142.50, before repositioning on dips.
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Potential Double Bottom:
- If Ethereum tests and holds $3,223, a double bottom could form, propelling it higher.
Risk Management Reminder 🚨
Remember, crypto trading carries risks. These levels and strategies are based on volume profiles and institutional behaviors. Always trade with proper risk management:
- Have clear stop-loss levels.
- Avoid chasing price action.
- Be patient and disciplined when waiting for entries.
Final Takeaway
Due to several reasons, Ethereum remains bullish for the long term, IMO, but the question is where to join. Check out $3,223 and $3,070 as attractive dip-buying levels for patient traders and investors. If these levels hold, Ethereum could revisit $4,000+ and eventually climb toward $5,000. However, sustained closes below $3,070 could invalidate the bullish premise.
📈 Trade smart, stay safe, and let the levels guide you. Visit ForexLive.com for additional views.
This article was written by Itai Levitan at www.forexlive.com.
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