Key takeaways
- Ether fell below the $3,400 level over the weekend as broader markets underperformed.
- The coin is now trading above $3,500 and could soon push toward the $3,700 level.
Ether recovers from weekend sell-off
Ether, along with broader cryptocurrency markets, underperformed last week. The second-largest cryptocurrency by market capitalization lost 8% of its value over the past seven days and hit a low of $3,359 on Saturday.
The weak performance was driven by several macroeconomic factors. The U.S. Federal Reserve left interest rates unchanged, while the Fed chair suggested that a September rate cut is not guaranteed.
Poor Nonfarm Payrolls data also signaled that U.S. economic growth slowed more than expected, and markets reacted negatively to renewed tariff discussions.
These macro developments coincided with more than $200 million in outflows from Ethereum ETFs, pushing Ether below the $3,400 mark.
Markets are now staging a recovery and may climb higher if conditions remain supportive.
ETH targets $3,700 resistance
The ETH/USD 4-hour chart turned bearish after Ethereum closed below the daily support at $3,730 over the weekend. The rebound above $3,500 suggests Ether found support near the 78.6% Fibonacci retracement level around $3,392. At the time of writing, it is continuing to recover and trading above $3,500.
Technical indicators are recovering from the weekend low. The 4-hour Relative Strength Index sits at 49 after bouncing from the neutral 50 level on Saturday and is pointing upward, indicating buying momentum is building. The MACD lines are also poised to cross into bullish territory soon.
If ETH sustains its recovery, it could extend the rally and reclaim the $3,730 resistance level. A continued move higher would open the door for Ether to test the monthly peak near $3,931.
Conversely, if ETH encounters a correction, it could decline again and retest the key support at $3,170. Bulls are currently defending support around $3,300.