Ethereum is currently trading just below an essential resistance level after successfully maintaining support at $3,800.

The market is closely monitoring whether buyers will break through the upward resistance or whether the price will face further setbacks.

ETH Stays Steady Around $3,800, Approaching Resistance Band

Ethereum has recovered from its recent lows and is presently trading approximately at $4,000. The support has been found in the range of $3,790 to $3,815, which has frequently served as a reliable base. Below this level, there’s another support area positioned between $3,550 and $3,670, providing a stronger cushion if necessary.

Analyst Ted noted that Ethereum has once again rebounded from $3,800 and is currently testing the resistance levels between $4,000 and $4,100. Historically, this range has demonstrated significant selling pressure. If buyers can manage to surpass this area successfully, the next target will be near $4,236 to $4,265. This price point has functioned as both support and resistance and may provoke renewed selling activity.

The existing market structure suggests that prices remain confined within a well-defined range. Various scenarios may unfold based on how the asset reacts to the resistance zone.

Technical Analysis Highlights Potential Breakout

On the three-day chart, Ethereum seems to be forming a traditional cup-and-handle formation. The ‘cup’ shape developed from January to August, as prices gradually pulled back from a lengthy decline. Following previous highs, the asset entered a consolidation phase.

The ‘handle’ is taking shape as a descending channel. Analyst Trader Tardigrade emphasized that there were three touches on both the upper and lower channel boundaries, indicating a controlled trading range. The chart confirms that ETH remains within this formation. A confirmed upward movement beyond this channel’s top could signal a continuation toward higher prices.

“A breakout is the next event.” — Trader Tardigrade

A clean breakout accompanied by increased volume would likely confirm the structure.

Market Sentiment Shifts as Key Events Approach

Additional commentary from Joe Swanson highlighted a triple bottom around $3,750, suggesting it may be a precursor for a potential breakout. He mentioned that if Ethereum exceeds $4,000, we could see a 10% increase towards $4,280. EtherWizz pointed out that the market may be entering a Wyckoff-style reaccumulation phase, with expectations of hitting $7,000 should $4,200 be reclaimed.

However, upcoming CPI data is expected, along with the Federal Reserve’s upcoming meeting, which might influence market sentiment. Ted stated:

“These events could trigger buying pressure in Ethereum and potentially lead to a short squeeze.”

Key Price Levels Under Observation

As Ethereum continues to hover near resistance levels, a cautious stance persists amongst many traders. Lennaert Snyder remarked he is analyzing the $4,050 level for possible short positions if the resistance shows strength, or long entries if the price exhibits a strong breakthrough.

Ethereum remains in a narrow trading band. A breakout exceeding $4,100 could shift market dynamics and stimulate significant buying interest, while a failure to break through may lead to further testing of support levels. Traders are closely observing how the asset reacts in this critical zone.