On February 3rd Monday, the crypto market witnessed a massive spike in volatility as speculation surged around the Trump administration’s new tariff policy. As a result, the Bitcoin price temporarily plunged to $91,500 before rebounding to $101,600, while the Ethereum price fell to $2,100 before reclaiming the $2,800 mark. The notable resilience of these assets shows potential for bullish reversal and renewed market recovery.
Key Highlights:
- The inverted head and shoulder pattern could bolster Ethereum price correction to bottom at $2,800.
- A bearish crossover between the 20-and-200-day EMA could intensify the market selling pressure.
- A downsloping trendline is a daily chart that directs the current correction trend in ETH.
Here’s Why Ethereum Price Must Hold $2,800
In the last two months, the Ethereum price showed a steady correction from $4,100 to $2,870, registering a loss of 30%. The formation of fresh lower highs in daily charts indicates sell-the-bounce sentiment intact among market participants.
However, the recent market fluctuation revealed ETH’s sustainability above the $2,800 level with a long-tail rejection candle. By the press time, the Ether price traded at $2,850 with an intraday gain of 0.5%. Meanwhile, the asset market cap holds at $345 Billion, and 24-hours trading volume at $90 Billion.
An analysis of the daily chart identifies the $2,800 level as the base support for the right shoulder in an Inverse Head and Shoulders (H&S) pattern. The formation of the InH&S pattern consists of three key troughs: the left shoulder, a deeper head, and the right shoulder.
If the $2,800 level holds, the Ethereum price should bounce 44% and challenge the neckline resistance of $4,100.
However, the anticipated rally could give in between resistance at $3,500, followed by $3,700.
Technical Indicator
Exponential Moving Average: The daily EMAs (20, 50, 100, and 200), including its trajectory downwards, indicate the increasing bearish sentiment in the market. A death crossover between the 50-and-200-day EMA could accelerate the selling pressure.
Relative Strength Index: The daily RSI slope at 35% accentuates the intact bearish momentum in price movement.
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