Ethereum is hovering at a key resistance level: Pullback or Breakthrough?

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Ethereum (ETH) has encountered resistance while testing the critical resistance level of $4000 recently, with strong seller presence in this area becoming a major obstacle for bulls to break through. In the short term, the market may face a pullback, but this also provides buyers with an opportunity to re-enter the market.

Technical Analysis: Double Top and Support Test

Daily Chart: Consolidation and Potential Double Top

Current Situation: Ethereum's price has attempted to break through $4000 multiple times, but has faced selling pressure each time.

Pattern: The price action has formed a double top bearish reversal pattern, suggesting a potential pullback to the $3500 support level.

Consolidation Range: ETH continues to fluctuate between $3500 and $4000, currently in a consolidation phase.

Potential Breakthrough: If it can successfully hold above $4000, a stronger upward momentum may follow, opening the door to new historical highs.

4-hour Chart: Ascending Channel and Liquidation Levels

Short-term Trend: At the lower boundary of the ascending channel, buyers have re-entered, pushing the price up briefly. However, it faced rejection again near $4000.

Volatility Range: The price is currently fluctuating between the support at $3700 and the resistance at $4000, with a further test of the channel's lower limit expected.

Liquidation Levels: Heatmap shows significant liquidation levels of short positions above the $4000 resistance level. This means that once a breakthrough occurs, ETH is expected to trigger large-scale liquidations in the short term, further pushing the price upward.

Key Price Levels and Market Strategy

$3500 Support Level: If the price pulls back, this may become a strong entry point for buyers.

$4000 Resistance Level: The primary short-term goal is to break through this level. Once breached, the market may attract more institutional and whale investors.

Liquidity Incentive: A large number of liquidation levels are concentrated above $4000, increasing the likelihood of ETH breaking through, while also providing a highly attractive target for bulls.

Market Outlook: Welcoming a New Round of Uptrend After Adjustment?

Ethereum is currently fluctuating between key price levels. Although the likelihood of a short-term pullback is high, the liquidation levels and the structure of the ascending channel indicate that the mid-term bullish trend remains intact. If it breaks through $4000, it will open up space for a new round of upward movement.

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