Ethereum price struggles below key resistance
Ethereum recorded modest gains over the past twenty four hours, rising roughly one to one and a half percent and trading within a tight range between approximately three thousand one hundred sixty and three thousand two hundred sixty dollars. Despite the short term recovery, price action remains constrained and lacks strong directional momentum.
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Bitmine Chairman Tom Lee stated at the Binance Blockchain Week on December 4th that $3,000 Ethereum is grossly undervalued, and that the current decline in the crypto market is mainly related to deleveraging, rather than the… pic.twitter.com/mRVRoHDcKO
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The asset continues to trade below its one hundred day and two hundred day moving averages. These longer term averages have acted as dynamic resistance in recent weeks, capping upside attempts and limiting follow through. A recent breakout above a descending trendline briefly improved sentiment, but price was rejected at a familiar resistance zone that has repeatedly stalled rallies since early November.
Technical structure shows fragile balance
On lower timeframes, Ethereum managed to break a bearish trendline before quickly losing traction. This behavior suggests that buyers are present but lack conviction, especially as broader market participation remains cautious.
A nearby bullish order block aligns with the previously broken trendline and may act as short term support. This zone has become a focal point for traders watching whether Ethereum can stabilize or whether sellers regain control. If price holds above this area, a consolidation phase may follow. A failure to defend it could open the door to renewed downside pressure.
The Relative Strength Index has cooled from overbought territory, reflecting fading momentum rather than a clear reversal. While this reset can be constructive in strong trends, the absence of strong spot demand limits its bullish significance in the current context.
Rising open interest increases downside risk
One of the more notable developments is the steady rise in Ethereum futures open interest. Market data shows that leveraged positions continue to build even as price recovery remains limited. Historically, this structure has preceded sharp moves when leverage becomes overcrowded.
When open interest rises faster than spot price, it often signals speculative positioning rather than organic demand. In such conditions, even modest price moves can trigger forced liquidations as traders unwind leveraged bets. This can lead to sudden volatility spikes in either direction.
Analysts note that elevated open interest paired with sideways or weak price action creates an unstable market environment. Without a clear expansion in spot buying, leverage driven rallies tend to be vulnerable to rapid reversals.
Key levels traders are watching
Ethereum remains at a technical crossroads. Sustained trading below the major moving averages keeps the broader structure cautious. Bulls would need to reclaim and hold above these levels to reduce liquidation risk and signal stronger trend continuation.
On the downside, a breakdown below the nearby support zone tied to the bullish order block could accelerate selling pressure, especially if futures positions begin to unwind simultaneously. For now, Ethereum’s price structure reflects balance rather than strength, with leverage acting as the primary driver of short term risk.
As long as open interest stays elevated without clear spot market confirmation, traders are likely to remain alert for sharp, fast moves driven by liquidation dynamics rather than gradual price discovery.
