Ethereum: These indicators encourage you to go short
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- The bearish short-term order block at $1920 showed that sellers had the upper hand.
- Ethereum is expected to slide to range lows of $1840 after an unsuccessful breakout last week.
Ethereum [ETH] prices brushed the $2000 mark yet again on 14 July but saw a rapid decline as sellers took control. Though the network has the largest base of fee-paying users, it was behind other networks in terms of daily active users.
Read Ethereum’s [ETH] Price Prediction 2023-24
An earlier report highlighted why a drop below $1950 presented a bearish case in the short term. The continued decline in ETH prices over the past 24 hours highlighted the growing bearish sentiment – and presented traders with an opportunity to short the token.
An ETH retest of short-term support at $1920 could be interesting
Bitcoin [BTC] and Ethereum both posted large gains on 13 July but were unable to hold on to the gains. While BTC showed some hope of a bounce, the price action of ETH hinted at further losses. The first indication was its immediate withdrawal back into the month-long range (yellow).
To add to the idea of seller dominance, over the past three days, Ethereum bulls were unable to hang on to the $1920 mark. This was accompanied by a sliding OBV, which showed increased selling pressure.
The RSI has stayed below the neutral 50 line since 15 July on the 2-hour chart to show bearish momentum has remained dominant in recent days.
A retest of the H2 bearish order block at $1910 will offer a selling opportunity. Short traders can target range lows at $1845 to book profits. Invalidation of this idea would be a move back above the $1940 level, just above the range highs.
Spot CVD agreed with the bearish findings from the OBV
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Over the past 24 hours, Ethereum has slowly slid lower from $1918 to $1894. At the time of writing, it saw a bounce to $1904, but the presence of the H2 order block meant further losses could be expected. As prices slid lower, Open Interest increased from $5.09 billion to $5.19 billion.
This was a sign of strong bearish sentiment in the market as speculators actively shorted the asset. The spot CVD has also trended downward to underline the lack of demand. Taken together, the price action and indicators showed sellers were winning the battle.