Ethereum has largely seen sideways movement between $2,500 and $2,350 over the past seven days. This sideways move has yet to give rise to a clear path on how the crypto performs going forward, damaging the sentiment of many bulls.
In an interesting analysis using the TD Setup, crypto analyst Ali Martinez highlighted a crucial price point for investors to keep an eye on in the ETH price trajectory. At the heart of this analysis is the $2,250 price, a level that could mark the line between a bullish recovery and a steep correction.
ETH price should include $2,250
The TD setup is very popular among crypto analysts and investors. Historically, Ethereum has shown a clear reaction after breaking above or below the TD setup. Its reliability in pinpointing key turning points has made it a tool for analysts like Ali Martinez.
Using an ETH/US Dollar price chart he shared on social media platform Martínez noticed that the TD Sequential has made or broken the cryptocurrency’s price action in the past, while also highlighting notable examples. Whenever ETH price broke above the TD setup resistance trendline, a strong bull run always ensued. On the other hand, when ETH fell below the setup support line, it corrected by an average of 53%.
The first significant break above the TD setup resistance triggered an 8.885% surge, pushing ETH price to an all-time high of $1,138 at the time. Conversely, the first time it fell below the TD setup, ETH price corrected by 56.67%. The last break above the TD setup occurred in March this year, when the ETH price rose around 113% as it rose above $4,000 for the first time in two years.
Recent price dynamics put the TD lineup around $2,250. According to Ali Martinez, a drop below this price point could cause a significant price drop. If a historical average of 53% were to repeat, Ethereum could correct to a low of $1,100.
Snapshot of the current market
At the time of writing, Ethereum is trading at around $2,410, about 7% above the critical threshold of $2,250 identified by the TD setup. While ETH price has managed to remain above this level for the time being, its proximity to this key price level makes it a crucial level to keep an eye on.
The sequential TD indicator identifies potential exhaustion points in an asset’s trend, whether bullish or bearish. Therefore, a break below $2,250 could mean that the final reversal of a bullish Ethereum to bearish sentiment.
Market sentiment towards Ethereum remains mixed at the moment. Salespeople currently have the upper handbut a break above $2,500 could pave the way for bullish momentum.
