Ethereum consolidated above $3,200 on Dec. 5 after a technical recovery from lower support levels, with traders monitoring resistance zones that could determine the next directional move. The cryptocurrency formed a contracting triangle pattern while holding above key moving averages. Price action suggests bulls are attempting to establish a foundation for another leg higher.
What Happened: Technical Consolidation
Ethereum price climbed from the $2,718 swing low recorded earlier this week, pushing through the $3,000 and $3,050 resistance levels before stalling near $3,240. The cryptocurrency peaked at $3,239 during the rally before pulling back to current levels around $3,120. Technical charts show ETH trading above its 100-hourly Simple Moving Average with a short-term contracting triangle pattern forming around $3,130 support.
The immediate resistance zone sits between $3,200 and $3,250, with bulls struggling to break decisively above this range. A move past $3,250 would open the door to $3,320, and potentially $3,450 or $3,500 in the near term. The 23.6% Fibonacci retracement level from the recent swing low has held as support during minor corrections.
On the downside, initial support appears at $3,120, followed by more substantial levels at $3,050 and $3,000. A breakdown below $3,050 could push Ethereum toward $2,980, which aligns with the 50% Fibonacci retracement of the move from $2,718 to $3,239. Further weakness might test support near $2,850 and $2,840.
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Why It Matters: Momentum Indicators
The hourly MACD indicator shows growing momentum in bullish territory, while the Relative Strength Index trades above the 50 level. These technical readings suggest buyers maintain control of near-term price action, though the failure to break above $3,240 indicates some hesitation. The contracting triangle pattern typically resolves with a breakout in either direction, making the next move above $3,250 or below $3,130 critical for determining Ethereum's path through the rest of December.
Market participants are watching whether Ethereum can match recent strength in Bitcoin, which also recovered from lower levels this week.
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