Ethereum climbed above $3,100 over the weekend with a more than 6% daily gain, but technical indicators suggest the rally pushed the asset into overbought territory. Analysts now warn that a price correction could follow despite renewed positive sentiment.
What Happened: Weekend Rally
The price surge accompanied **Bitcoin's** upward movement, allowing Ethereum to reclaim the $3,000 level faster than market watchers anticipated by Sunday.
Crypto analyst SignalProvider noted in a TradingView post that the four-hour timeframe shows Ethereum entered overbought levels, with the 7-period RSI indicating bearish conditions.
The analyst identified $3,028 as the first downside target if the correction materializes, which could then serve as support for the next uptrend.
Also Read: Trump Tokens Rally Following Venezuela Military Operation Saturday
Why It Matters: Conflicting Signals
The overbought reading comes as Ethereum trades above what SignalProvider called a solid horizontal structure at $3,100, though the level has shown unexpected weakness.
However, crypto analyst TheSignalyst presented a contrasting view, pointing to the lower bound of an ascending channel providing support above $3,000.
"From a structure point of view, ETH remains bullish, trading cleanly inside a flat rising channel," TheSignalyst wrote, adding that a complete breakout could push prices toward $3,600.
TheSignalyst cautioned that investors should expect continued sideways movement until the breakout occurs.
Read Next: Aave Founder Pledges Revenue Sharing After 55% Vote Opposes Community Control