- Ethereum price is hovering just above the $3,905 to $4,027 demand zone, anticipating a reversal.
- The smart-contract token looks to retest $5,000 but faces two resistance barriers in its path.
- A breakdown of the $3,905 support level will suggest further downside is likely.
Ethereum price suffered a setback as it crashed from November 15 to November 17. This downswing pushed it down to a crucial demand zone, where it is trying to make a comeback.
Ethereum price triggers a premature upswing
Ethereum price set up five higher highs and three lower lows between October 13 and November 14. These swing points can be connected using trend lines, leading to the formation of an ascending parallel channel.
This technical formation hints at a bearish outlook, which Ethereum price underwent as it dropped roughly 15% between November 15 to November 17. Comparatively, ETH came close to retesting the $3,905 to $4,027 demand zone without dipping into it.
So far, Ethereum price has rallied 6.8% and looks to scale higher. If the buying pressure continues to hold, ETH will restart its ascent and make a run at the $5,000 psychological level.
However, this run-up is riddled with two crucial resistance levels at $4,517 and $4,727. Ethereum price needs to flip these two barriers into support floors to complete a15% ascent.
ETH/USDT 1-day chart
While the current upswing looks good, Ethereum price might reverse its trend to revisit the $3,905 to $4,027 demand zone. Doing so will provide ETH with the necessary bullish momentum to slice through the said barriers and reach its target.
However, failing to hold above $3,905 will indicate weakness among buyers and indicate that the sellers are not done yet. This development could trigger a selling spree to knock ETH down to a stable support level at $3,617.
