Ethereum Must Break $3,850 to Avoid Drop to $3,100, Analyst Warns

Ethereum must close above $3,850 to avoid a possible ABC correction, with downside risk extending toward the $3,100 support level.

Analyst notes 3D RSI entered overbought zone, suggesting ETH could take longer before attempting a successful breakout above the $4,000 level.

A move above $4,000 remains possible with consolidation, and the broader bullish structure remains intact despite short-term resistance pressures.

Ethereum (ETH), as of writing, is trading at $3,614.99 with a 1.80% increase over the last 24 hours, with a daily trading volume of over $29 billion. At present price trends, traders should pay attention to levels of potential resistance and corrections.

Price Must Reclaim $3,850 to Avoid Deeper Pullback

Crypto analyst Sykodelic cautioned that Ethereum needs to reclaim the $3,850 level on the daily close to maintain bullish momentum. According to the analyst, failing to do so could trigger an ABC correction pattern, potentially dragging the price down to the $3,100 range.

The 3-day Relative Strength Index (RSI) recently entered overbought territory at the market’s recent peak. This suggests that Ethereum may take more time to gather strength for a push above $4,000. While the overall higher time frame structure remains intact, current price action indicates that ETH could enter a short consolidation phase.

Sykodelic stated, “We need to get back above $3,850 and close on the 1D. If we don't, I can see this ABC correction playing out.”

Consolidation Above $4,000 Still Within Reach

Although there could be a correction, Ethereum nevertheless shows the possibility to continue its upward move. Sykodelic emphasized that there could be a move above $4,000 without RSI making a new high, indicating consolidation rather than weakness.

The analyst suggested that this scenario would not invalidate the current market structure. Consolidation above the $4,000 mark could position Ethereum for a return to local highs before month-end, especially if daily closes regain bullish control above $3,850.

This setup aligns with market behavior where price can continue to rise, even with RSI showing divergence. Traders are watching closely to see whether ETH will regain momentum or face another temporary pullback.

Market Structure Remains Bullish Despite Near-Term Uncertainty

While short-term resistance levels may delay a breakout, Ethereum’s overall bullish structure remains unaffected. A deeper pullback to $3,100 would likely be short-lived if buying pressure re-emerges at that zone.

Analysts believe that even if the ABC correction plays out, Ethereum could be back near its local highs by the end of the month. The monthly close will be crucial in determining the strength of this cycle’s continuation.

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