Ethereum declined below $3,000 on Dec. 16 as traders assessed the cryptocurrency's near-term direction amid consolidation patterns. The second-largest digital asset by market capitalization now faces technical resistance levels that could determine whether a recovery materializes or further losses extend toward $2,840.
What Happened: Price Drops Below Key Technical Level
Ethereum price fell approximately 5% from the $3,175 zone, breaking through the $3,000 support level that technical analysts had monitored.
The cryptocurrency reached a low of $2,916 before entering a consolidation phase below the 23.6% Fibonacci retracement level of its recent downward movement.
The asset now trades beneath both the $3,000 mark and its 100-hour Simple Moving Average. A bearish trend line has formed with resistance positioned at $3,120 on hourly charts.
Price action mirrors recent movements in Bitcoin, which experienced similar downward pressure. The decline pushed Ethereum below the $3,120 and $3,050 levels before reaching the $2,916 low.
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Why It Matters: Technical Indicators Signal Direction
Technical indicators present a mixed outlook for Ethereum's immediate trajectory.
The Moving Average Convergence Divergence indicator shows increasing momentum in bearish territory, while the Relative Strength Index has fallen below the 50 zone—traditionally interpreted as a neutral threshold between bullish and bearish sentiment.
Recovery scenarios depend on whether Ethereum can reclaim the $2,980 resistance level.
A successful move above this point would target the $3,050 level and the 50% Fibonacci retracement of the recent decline. Continued upward momentum could push prices toward $3,080, with additional resistance at $3,120 representing a critical breakout level that might enable gains toward $3,175 or $3,200.
Failure to overcome the $2,980 resistance could trigger further declines. Initial support rests at $2,950, followed by major support at $2,920. A breach of the $2,920 level would likely accelerate selling pressure toward $2,880, with subsequent support zones at $2,840 and $2,800.
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