Ethereum (ETH) is signaling a possible near-term price correction as market indicators point to overbought conditions following its recent surge.
The Relative Strength Index (RSI) has climbed sharply above the 80 level. This technical reading traditionally indicates an overbought state, suggesting potential exhaustion among buyers and increasing the likelihood of a temporary pullback.
Supporting this technical warning, the trading volume that fueled ETH’s upward trajectory has started to decline significantly. This tapering volume signals diminishing buying pressure, further supporting the case for a consolidation phase.
Analysts highlight the $3,000 to $3,200 price range as a crucial near-term support zone. The market’s ability to hold above this range is considered vital for maintaining Ethereum’s overall bullish structure following any pullback.
Market observers view this anticipated period of consolidation positively, stating it is a healthy development that allows the market to absorb recent gains and establish a more balanced foundation.
While a short-term retracement appears increasingly probable, the broader technical outlook remains constructive. Indicators suggest this consolidation could precede a resumption of Ethereum’s upward trend, with the potential to target the $5,000 milestone in the next significant move.