ETH could drop below $3,500 soon
Altcoins have been underperforming for the past few hours despite Bitcoin breaking the $56k barrier and looking to establish further gains in the coming hours
The cryptocurrency market has performed well since the start of the month, with the total market cap adding more than $400 billion over the past few days. However, altcoins are currently underperforming despite Bitcoin inching closer to the $57,000 level.
Ethereum has been one of the top performers in recent weeks, crossing the $3,600 level along the way. However, it is currently undergoing a retracement period, and its price is down by more than 1% over the past 24 hours.
At the time of writing, ETH is trading just above the $3,500 point and could drop lower if the cryptocurrency continues in its current bearish trajectory.
Ethereum price outlook
The ETH/USD 4-hour chart is still bullish since the cryptocurrency has been rallying over the past few days. The ETH MACD line is currently in the bullish zone, while the relative strength index of 47 shows that Ether is in the neutral zone.
Ether is currently trading slightly above $3,500. If the bearish sentiment continues, it could drop towards the $3,476 pivot. A decline to that level could bring Ether’s first major support level at $3,346 into play over the next few hours.
Unless there is an extended sell-off period in the market, Ether should avoid sub-$3,300 levels, with the second major support level currently sitting at $3,277.
ETH 4-hour chart. Source: TradingView
However, if Ether stays above the pivot level, it could surpass the first major resistance level at $3,545 in the coming hours. With the support from the broader cryptocurrency market, Ether could look to surpass Sunday’s high of $3,605.49.
Unless there is an extended bullish performance in the market, the $3,800 level should cap further upward movement in the short term. The cryptocurrency market has been performing well in the past few days, and Ether could embark on a rally if the other altcoins also start performing well.
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