The recovery in the Ethereum price back above $4,000 was short-lived. The market has dropped 8% from yesterday’s high and is looking weak.
After suffering a sharp sell-off on Thursday, Ethereum (ETH) reversed course on Friday and looked likely to attack the all-time high once again.
ETH had a cracking run in the first two weeks of this month. By the 12th, The Ethereum price had gained 57% to set a new record of $4,378.
Things took a horrible turn for the worst the following day when the price reacted sharply to Elon Musks Bitcoin tweet.
Margin traders, who joined the rally late, were forced out of their newly-minted long positions, resulting in a steep decline to $3,395. Volatile trading ensued as the market struggled for price-discovery in the aftermath.
A jump to $4,000 was again met with selling, sending the price back below $3,600.
Yesterday, it appeared that the Bulls were finally back in charge and the Ethereum price staged a strong recovery to reclaim not only $4,000 but trade as high as $4,182.
The price is back below $4,000 today and currently trading at $3,900. Furthermore, it looks like it wants to go lower.
Ethereum Price Outlook
The recent price action suggests that there is selling between $4,000 and $4,400. Undoubtedly there will be also be buying on dips.
It looks to me that buyers will be active, scale-down from $3,600 to $3,400. Therefore I see this as a good level to accumulate ETH. However, a clear break of this lower end might suggest further declines could be on the cards.
Alternatively, if the price can clear the previous high, it would indicate the selling has dried up for now, and the bulls might once again be beating the drum for $5,000.
Presently, it makes sense to wait it out until a clearer path emerges. Buyers might get the chance to pick up some ETH at even more of a discount in the next few days.