Ethereum has recovered from the $3.2,000 area after a significant liquidity sweep, suggesting that the recent downtrend may dry up.
Although short-term resistance remains strong, both technical and on-chain data suggest that the market may be entering a large-scale participant-driven accumulation phase.
technical analysis
Written by Shayan
daily chart
On the daily time frame, ETH has decisively recovered from the $3,000-$3,2,000 demand block, which coincides with the lower trendline of the channel and the 200-day moving average. This confluence zone acted as a strong reaction site, leading to the formation of a long lower core, evidence of stronger hand fluid absorption.
The recent breakout attempt from the descending parallel channel is the first constructive signal since mid-October. ETH is currently retesting the $3.6 million-$3.7 million resistance cluster marked by the intersection of the channel midline and the institutional decision point.
If buyers are able to close above this range, it could confirm a structural change and pave the way for a continuation towards $3,9,000-$4,0,000, followed by a higher liquidity zone around $4,4,000. However, failure to sustain above $3.6,000 could trigger a short-term retest of the $3,000 region, which currently serves as major support.
4 hour chart
Zooming in on the 4-hour chart reveals the trap set in more detail. After an aggressive breakdown below $3,000, Ethereum briefly expanded into a $3,000 liquidity pocket and quickly reversed after clearing the lows of the descending channel. This sharp recovery nullified the bearish momentum and triggered a short-term reversal.
Prices are now consolidating just below the “seller base” of $3.6K to $3.7K, which represents the last unmitigated supply area that formed before the previous decline. A clean break through this base and a retest would likely confirm that market control has returned to buyers. Until that happens, ETH is expected to fluctuate between $3.4,000 and $3.7,000, building structure before the next expansion leg.
RSI momentum confirms this scenario. Having broken out of a multi-week bearish divergence trend line, it is now moving steadily higher, suggesting there is room for further recovery if this structure holds.
sentiment analysis
Written by Shayan
Ethereum’s spot average order size metric reflects notable behavioral changes following the recent market consolidation. There was a brief spike in whale-driven activity (green cluster) during the decline towards $3.2,000, a pattern that has historically preceded local troughs and early accumulation stages.
This shift means that while retail traders remain cautious, large market participants are re-entering exposure at discounted prices. In previous cycles, similar transitions, from whale accumulations to retail declines, have marked the beginning of a trend reversal or a late-stage compression phase that precedes a big rally.
If this move persists and the $3.4 million-$3.4 million area holds as structural support, Ethereum could enter a low-volatility accumulation zone and set itself up for a potential final bullish impulse towards the $4.5 million-$4.8 million ceiling.
