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The past week has been just as tough for Ethereum as it has been for Bitcoin. The altcoin formed the biggest bearish candle since the beginning of November and made a bearish breakout of the $1,250 support level. The next target for sellers was the $1,200 level.
Over the weekend, trading activity subsided, which allowed ETH to move into a consolidation phase and absorb free coin volumes. As a result, as of December 20, the cryptocurrency began testing the $1,200 support level. In case of a downward breakdown of this level, the asset risks going to a retest of $1,000.
It is impossible to consider the price movement of Ethereum at the current stage of the market without comparing it with the dynamics of Bitcoin. Assets move head to head and show similar signals on technical metrics.
On Bitcoin, we have seen buying activity leading to a defense of the $16.6k level. We see a similar situation on the Ethereum charts, however, unlike BTC, there is an activation of bears near the $1,220 level.
However, in general, the bulls managed to accumulate solid volumes at the very start of the trading day, which happens infrequently, given the strategies of the Asian region. Given the bullish morning, it is likely that with the opening of U.S. markets, the situation will improve.
As of writing, the sharp activation of buyers is not supported by the growth of on-chain activity for several days. This may indicate manipulation by the market maker, who needs to keep the price above the $1,200 level.
At the same time, it is quite acceptable that the on-chain activity of the cryptocurrency will begin to grow with the upward movement of ETH/USD. However, if the price of ETH continues to rise without a parallel increase in activity in the altcoin network, then the altcoin price increase should be considered manipulation and a bull trap.
There is reason to believe that Ethereum will continue its upward movement on December 20. The technical metrics of the asset indicate the emergence of a local upward trend. On the daily chart, there is an increase in sales volumes and reversal of the RSI metric upward.
The stochastic oscillator formed a bullish crossover near the green zone and also turned up. These signals confirm the presence of active buyers, and therefore we should expect a retest of resistance levels.
The price of ETH/USD is moving towards the $1,220 level, which is a key resistance zone. The bulls have already managed to absorb some of the bearish volumes, but sellers have stepped up near the $1,200 level.
On the 2-hour chart, we see a gradual expiration of the bullish potential, which was more likely a reaction to the $1,150 level spike. Moreover, we see a flat RSI and stochastic, which indicates a weakening of the bullish momentum and a gradual decrease in buying activity.
Ethereum managed to defend the $1,200 mark, but the bears tested the $1,150 level. This triggered a backlash from buyers and buying back bearish volumes, which prevented the price from gaining a foothold below $1,200. However, as of wriritng, the bullish momentum begins to fade, and the advantage gradually shifts to the bears.
Despite this, the altcoin has chances for further growth with the corresponding BTC price action and bullish sentiment in the stock market. ETH will not be able to gain a foothold above $1,220 without additional market maker moves and before the opening of U.S. trading.
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