Is the price forecast for Ethereum that it's going to bounce back or will ETH go down to $2,000?

Ethereum close to $2,500 behind the downward pressure from resistance line $2,700

Ethereum selling close to $2,500 after a strong base correction from the resistance zone of $2,700 that put key lines under pressure, even though ETH is still above its 100-day and 200-day daily moving averages, but weaker momentum and reversals in supply ratios on centralized exchanges over recent months reflect that traders need to watch for further fluctuations before assuming a broadband recovery will return.

Daily graph: The $2,700 resistance also indicates a short-term structural fate.

The daily graph of Ethereum shows a strong recovery from the June lows near $1,500 followed by an upswing through zone $2,000 into area $2,400 then ETH moving closer to resistance zone $2,700 and pivoting for several weeks before sellers regained control in early October

The recent reversal from supply chain $2,700 has returned the price back to its first line of resistance. $2,400 orders started responding after a new sell-off, with yesterday's candlestick having broken through and recovering but recovery is still limited and can not be confirmed as an obvious upside.

If the $2,400 line is still at ETH, it may try to retest its main resistance near $2,700, and crossing above that level permanently will improve short-range structure, potentially opening up a path into zone $3,000.

However, if the daily closing price is clearly below the $2,400 support zone, the recovery structure will be weakened because a leg up on the parachute from the June lows will be broken down. In that situation, the next key resistance is near the 89004-$2,200 zones, which are areas where the 100-day and 200-day moving average lines have just formed positive intersections.

The relative strength index on the daily frame decreased to near level 40 indicating a weaker momentum and started leaning towards the sell side. Even though the gauge approaches too close to the sell zone, it is still below standard 30. A recovery above 50 will give a clearer signal that the buy side has regained control but if it weakens further below 40 ETH, there is a risk of being tested for resistance again.

Four-hour chart: Sales up sharply after the $2,600 drop.

Graph ETH/USDT four-hour period shows a clearer picture of the sales force than Ethereum spent most of late September fluctuating between about $2,600 to $2,800 before slowing down earlier this week, selling accelerated after ETH, lost its lowest point $2,600, and brought the market down into zone $2,400

The recent bulls have shown a slight rebound, returning to near $2,500 after a downturn that reflects buyers coming into the lineup but too little recovery to confirm that the base adjustment is complete.

The first reversal is near the $2,600-$2,700 zone, which is an area where ETH has to climb through negative imbalances caused by falling downwards. The $2,400 reverse was the first point to be detected.

The relative strength indicator on the four-hour frame recovered from a sell zone too deeply approaching level 40 this recovery indicates selling force may have faded but momentum is still weak and below the central 50 levels the indicator must be stronger with price so it will support a more pronounced recovery

The supply on the exchange board is starting to bounce back.

The supply ratio on an exchange board measures the ratio of a rotating supply of Ethereum on a zero-sum exchange board to the total supply that this indicator tracks. It helps show changes in the volume ETH on the board, but cannot confirm by itself whether the holder wants to sell

The graph shows a continuous decline in this ratio throughout most of 2012, with the indicator measured down from about 0.142 at the beginning of the year to around 0.124 in September, during that same period.

This behaviour is noticeable, the decreasing ratio reflecting that supply on the board was lower compared to total supply tracked by the indicator. A drop of ETH on the chart may correspond to self-accumulation or withdrawal into storage, which could cause an immediate reduction in available ETH, but a graph alone cannot account for this movement.

In recent years, the supply ratio on board has begun to recover from its low point. The increase is still limited compared with previous declines but keep an eye out for a new base adjustment of ETH.

If the ratio continues to rise while ETH is still stuck below $2,700, that may reflect a partial return of supply to the exchange, which could increase liquidity on the sell side. This interpretation would be more worrisome if accompanied by further weaker prices and stronger flows into the exchange because it might put pressure on the buy side and lower prices again in the coming weeks.

Originally published on CryptoPotato