Ethereum has had its price swaying within a range since the January sell-off. The latest downside after the FOMC conference on May 4 and 5 appears to catalyze colossal declines that might breach the created range. Enthusiasts should watch Ethereum as upcoming drops might offer lucrative buy-the-dip opportunities.
ETH Ready for Further Declines
Trading sessions between January 18 and 24 saw Ethereum losing 33% to print a swing low near $2,158. The declines attracted multiple market participants that rushed to accumulate the dips. That saw Ethereum gaining 51% within the following two weeks, printing the $3,266 swing high. The leg-up formed a range that still prevails.
Generally, ranges are stress-free to trade and spot. Remember, the token sweeps one range limits and moves to sweep the other. For instance, Ethereum’s 51% upswing witnessed a downside move below the 50% retracement area at $2,712. A rally followed the correction, pushing Ethereum 55% higher to sweep range highs.
However, the alt could not maintain momentum amid the upsurge, leading to a sharp reversal that saw Ethereum dropping into the range. Though the token witnessed a massive rebound near $2,712, sellers overwhelmed buyers following an overturn of the support into resistance on May 6, around the FOMC meeting time.
Dominant selling momentum triggered a steep decline to $2.360. While writing this content, Ethereum traded at $2,386.84. As bears appear in front seats, Ethereum can drop to retest the support floor at $2,297, which might ensure a slight buying pressure spike.
Market players should prepare for declines beneath this barrier, sending Ethereum to sweep the $2,158 range low. A swift move beneath this mark might welcome a revival beyond it.
Nevertheless, dire scenarios could see Ethereum retesting -0.27% retracement zone near $1,859. The most lucrative spot to purchase the Ethereum dip would be $1,730, beneath which lies sell-stop liquidity created in May 2021 and July 2021.
The supply distribution chart adds credence to the dip-buying thesis, as it indicated Ethereum wallets with 10,000 – 100,000 Ether have surged to 1,187 on May 9 from 1,187, reflecting holders accumulating more tokens. That shows the whales are optimistic about Ethereum price performance.