Ethereum price recovery in jeopardy after bulls lost a crucial support barrier
|- Ethereum recovery hits pause at $1,100, delaying the much-anticipated journey to new yearly highs at $1,400.
- Ethereum whales are adding to the overhead pressure by offloading their bags according to the holder distribution metric.
Ethereum struggles with recovery following an extensive breakdown from the recently established new yearly high at $1,352. The most crucial support at $1,100 did little to avoid the massive freefall, which retested $900. For now, all attention has been channeled toward reclaiming the lost ground above $1,100 to favor gains eyeing $1,400.
Ethereum recovery hits massive overhead barriers
At the time of writing, Ethereum is trading at $1,080 after completing a leg up from the primary support at $900. The 100 Simple Moving Average had anchored the upswing on the 4-hour chart. However, the support turned resistance at $1,100 is limiting upward price movement.
Regaining the lost ground above $1,100 could catapult Ether to higher levels at $1,200 and $1,400, respectively. It is worth noting that some delay may be encountered at the 50 SMA, currently holding the position at $1,150.
ETH/USD 4-hour chart
After losing the crucial support at $1,100, Ethereum became vulnerable to the bearish advances. Thus, recovery is an uphill task, as observed using IntoTheBlock’s IOMAP model. The on-chain metric reveals high congestion of sellers between $1,138 and $1,170. Here, nearly 34,200 addresses previously bought roughly 5.6 million Ethereum.
Ethereum IOMAP chart
On the other hand, the model reveals the lack of a substantial support area for ETH. This means that technical support at $1,070 is shattered in the short term; the price may refresh lower levels. Meanwhile, the IOMAP shows that the most formidable support runs from $944 to $975. Here, roughly 225,000 addresses had previously bought approximately 1.1 million ETH.
According to Santiment’s holder distribution metric, Ethereum whales are gradually losing interest. This has been highlighted by the ongoing decrease in the number of addresses holding between 100,000 and 1 million ETH. The whales topped out at 161 on January 9 and have reduced to 158. Although this may seem insignificant at first, the volume moved by these large volume holders is usually massive, which explains the rise in overhead pressure in the last few days.
Ethereum holder distribution chart
It is worth mentioning that the bearish outlook will be invalidated if Ethereum closes the day above $1,100. More gains are expected to come into the picture with ETH doddering above this crucial level. A breakout will also be confirmed if Ethereum spikes past the 50 SMA for gains to $1,200 and $1,400.
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