Ethereum (ETH) is losing all its gains, Bitcoin (BTC) is unwilling to give up $40,000, and Solana (SOL) is beginning its comeback

Arman Shirinyan

The market is finally showing signs of recovery, but not all assets are on board

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Ethereum has wiped out the gains it had accumulated over an extended period of time. The ETH/USD price chart shows a grim story as the digital asset has quickly fallen from its peak and returned to levels that question the sustainability of its previous growth.

The sharp drop in Ethereum price is a clear bearish signal. This reflects the market's reluctance to invest at previous highs, most likely due to Ethereum's recent underperformance. This lack of traction and inability to initiate a recovery highlights the vulnerability of Ethereum price in the current market climate.

ETH/USD chart from TradingView

On the technical side, Ethereum has broken what was once considered a strong support level around $2,350. This price point, where there was previously strong buying interest, has now been broken, creating a cascading effect as the asset looks for new support. The next critical support level is around $2,175, where buyers could emerge to halt the decline.

Conversely, any attempts at recovery initially face resistance around $2,338, a level that now marks the lower limit of what was a consolidation range before the decline. A close above this level on significant volume could signal a temporary easing of selling pressure. However, the real test lies at higher resistance levels, previously established around $2,500, where ETH struggled to maintain bullish momentum.

Bitcoin is ready for battle

The recent candlestick formations represent a scenario where Bitcoin is flirting with a critical resistance level, poised to either confirm a downtrend or initiate a significant recovery.

The chart illustrates Bitcoin's recent decline as it lost its footing in the higher price levels it previously held. However, amidst this bearish move, Bitcoin is showing signs of resilience. Recent candles suggest a possible reversal as they hover around a key support level located around $37,000, an area where buyers have intervened in the past.

A sustained hold above this point could trigger renewed buying interest, which could push the price towards the immediate resistance level around $41,000. The importance of recapturing this threshold cannot be underestimated, as it could invalidate the pessimistic outlook and signal a trend reversal.

As for upper resistances, the $43,000 and $46,000 price levels stand out as notable barriers that Bitcoin would need to break through to cement a robust recovery narrative. Achieving such milestones could positively influence market sentiment and potentially trigger a wave of optimism among investors.

The moving averages provide additional insight and suggest a possible bullish crossover should the current momentum continue. This scenario would be further reinforced by an increase in trading volume, which typically accompanies key trend changes.

Solana among the frontrunners

Solana is showing signs of a nascent comeback, representing a bullish scenario amid a broader market rally. However, investors are treading cautiously, aware of the possibility of a dead cat bounce as volume profiles signal restraint.

Analyzing the SOL/USDT chart, we note that Solana has established a local support level around the $70 price mark. This is marked by multiple touches of this level in recent weeks, each time resisting further downward movement.

On the other hand, local resistance can be identified near the $96 level, which previously acted as support during Solana's ongoing uptrend.

Price action is currently between the 50-day moving average, which is acting as dynamic resistance, and the 200-day moving average, which is acting as potential dynamic support. The narrowing gap between these averages could put pressure on price action and potentially lead to a breakout in volatility.

About the author

Arman Shirinyan

Arman Shirinyan is a trader, crypto enthusiast and SMM expert with more than four years of experience.

Arman strongly believes that cryptocurrencies and the blockchain will be of constant use in the future. Currently, he focuses on news, articles with in-depth analysis of crypto projects, and technical analysis of cryptocurrency trading pairs.

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