Ethereum and cryptocurrency markets send worrying signs despite last Friday's spike

Cryptos have all shined on Friday after Powell's speech that largely got interpreted as dovish – One of my thesis was that these moves may have been slightly over-extended compared to what was actually said.

Markets tend to act erratically with algorithmic movements and stops triggering leading to extreme moves that tend to be corrected after some proof-reading by some of the largest participants.

The US Equities market is still around its Friday highs with the Dow Jones futures above their previous highs (down small on the pre-open session) indicating no strong correction from the recent upside.

On the other hand, cryptos are looking a bit more skeptical – Ethereum broke a new record on Saturday ($4,956) before retracting lower, currently down 4% on the session.

Bitcoin also retested $117,000 and quickly reversed back to around the $111,000 handle, retesting its support zone that will have to hold to avoid a more bearish short-term outlook.

You can access our latest analysis for BTC right here to get your levels for upcoming trading.

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Despite the new record in ETH, the rest of the market hasn't followed through with the Market cap correcting around 8% since.

The chart is still far from bearish but this will have to be monitored to check if the bullish momentum inverts further.

The picture is red, but most cryptos are still fairly close to their highs, I would suggest to look at risk-on/risk-off assets demand to assess if the mood gets better from here or not.

If the current picture stays like this, a double top combined with a bearish divergence (new highs in price ≠ new highs in RSI) could bring some decent reasons for Participants to take profit around here.

Nonetheless, as always in Financial markets, if the price action was that bearish, prices would be much lower already.

But these signs are not to be taken lightly and have to be monitored closely for upcoming trading.

Ethereum has retracted from its recent highs (ETH CFD not showing but actual coin traded to $4,956 highs, currently around $4,640) which allowed overbought momentum to cool down on shorter timeframes.

As long as prices hold above the $4,000 to $4,095 (Dec 2024) pivot zone, the price action remains more bullish than bearish – but do keep an eye on the potential double top mentioned on the daily timeframe.

Levels of interest for ETH trading:

Support Levels:

• $4,200 consolidation Zone (minor support)
• $4,000 to $4,095 Main Pivot
• $3,500 Main Support Zone

Resistance Levels:

• $4,950 Current new All-time highs
• $4,700 to $4,950 All-time high resistance zone
• Potential main resistance $5,230 Fibonacci extension.

Safe Trades!