Ethereum's Price Drops 5% After Surpassing $2,720

Ethereum's price has recently shown significant volatility, with a notable increase above the $2,720 mark before correcting gains and revisiting the $2,500 support zone. The cryptocurrency initially surged past the $2,720 resistance, trading above $2,520 and the 100-hourly Simple Moving Average. However, the price has since dipped below $2,650, spiking below the 50% Fib retracement level of the upward move from the $2,415 swing low to the $2,736 high.

Despite the correction, bulls remain active above the $2,550 level, with Ethereum currently trading above this mark and the 100-hourly Simple Moving Average. On the upside, the price faces hurdles near the $2,620 level, with a short-term declining channel or a possible bullish flag forming with resistance at $2,630 on the hourly chart of ETH/USD. The next key resistance is near the $2,680 level, with a clear move above the $2,720 resistance potentially sending the price toward the $2,820 resistance. An upside break above the $2,820 resistance might call for more gains, with Ether potentially rising toward the $2,880 resistance zone or even $2,950 in the near term.

If Ethereum fails to clear the $2,630 resistance, it could start a fresh downside correction. Initial support on the downside is near the $2,575 level, with the first major support sitting near the $2,500 zone or the 76.4% Fib retracement level of the upward move from the $2,415 swing low to the $2,736 high. A clear move below the $2,500 support might push the price toward the $2,420 support, with any more losses potentially sending the price toward the $2,350 support level in the near term. The next key support sits at $2,320.

Technical indicators suggest that the MACD for ETH/USD is losing momentum in the bullish zone, while the RSI for ETH/USD is now below the 50 zone. Major support and resistance levels are at $2,575 and $2,680, respectively. Analysts suggest that the current price dip may offer a buying opportunity for bulls eyeing reentry into the market. The formation of a short-term declining channel or a possible bullish flag indicates that Ethereum could find bids near $2,500 and start a fresh increase in the near term. However, if the price fails to clear the $2,630 resistance, it could start a fresh downside correction, with initial support on the downside near the $2,575 level.