ETH Price Analysis: As Market Rebounds, ETH/USD Returns to Key Resistance, Ethereum on Track in Its Deflationary Path

• ETH plunged slightly lower than the closely observed $4,000 threshold
• The token’s all-time high of $4,867 may act as a further roadblock for Ethereum’s price
• Since the EIP-1559 occurred, also referred to as the London hard fork, $4.24 billion in ETH has been burned

Ethereum has fallen victim to a collapse in worldwide markets on Friday after Thanksgiving. The crypto markets have had a disappointing week, with most large-cap assets down steeply as investors retreated from risk markets around the world amid concerns over the impact of a potentially dangerous new COVID-19 variant. ETH plunged slightly lower than the closely observed $4,000 threshold to a $3,915 low. However, as the market rebounds, ETH/USD returns to challenge the $4,200 key resistance. At the time of analysis, Ether is hovering at $4,146, gaining 2.25% on the day after reaching an intraday high of $4,186. The token’s all-time high of $4,867 may act as a further roadblock for Ethereum’s price, although a break above this level could reveal more positive intentions for the cryptocurrency. Since the EIP-1559 occurred, also referred to as the London hard fork, $4.24 billion in ETH has been burned. As per data from Ultrasound, a total of 5.4 million ETH is issued per year, while it burns a total of 4.7 million with a reduced balance resulting in a supply growth of 0.6% per annum. It depicts evidence that Ethereum is continuing on its deflationary path.

Key Levels
Resistance Levels: $4,700, $4,400, $4,200
Support Levels: $4,000, $3,700, $3,500

ETH/USD Daily Chart: Ranging

ETH/USD Daily Chart

The price drop below the moving average (MA 50) on the daily chart indicates downward pressure. Near-term selling activity also prevailed as the no. 2 crypto battled to stay above the support at $4,000, which was previously a barrier from last September’s peak and mid-October. Thanks to a spike in positive actions as negative momentum decreases.

Overall, Ether has recouped some losses after plunging to $3,915. Since the loss generated a 4-week low, buyers’ emergence around the $4,000 handle may attempt to make a bullish return. The decline from the $4,861 all-time high is reinforced by the bearish Relative Strength Index signaling a slowdown in the upward momentum.

ETH/USD 4-Hour Chart: Ranging

ETH/USD 4-Hour Chart

Currently, the short-term oscillators suggest bulls are promoting additional advances in the pair above the $4,000 mark. However, bears’ may sell on rallies beneath the 4-hour moving average (MA 50) around $4,200. If buyers manage to extend the rebound past this region, initial upside friction could commence at the moving average (MA 200) at $4,400.

Otherwise, if positive forces start to subside, preliminary support could stem from the $4,000 mark, the lower support region at $3,800. And should the bearish trajectory resume, the price could target the ascending trendline around $3,700. ETH/USD is exhibiting a range-like bias, and for bulls to counter bears, buyers need to steer the price above the $4,200 barrier.

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