- OBV surged from 10.25M to 12.5M after July breakouts, confirming accumulation and strong buying pressure.
- Ethereum’s OBV now tests 12.75M channel support after retreating from recent highs near 13.25M.
- Snyder noted reclaiming $4,250 resistance is crucial for Ethereum, with rejection risking short positions and deeper retests.
Ethereum is testing key technical levels as its On-Balance Volume (OBV) indicator shows a potential breakdown. The OBV, currently at 12.78 million, has shown accumulation patterns since July.
However, the indicator is now revisiting the lower boundary of a rising channel, raising concerns about near term momentum. Analyst Lennaert Snyder noted that Ethereum is testing its previous range low as resistance.
He added that the asset must reclaim $4,250 to regain upward momentum, while rejection at this level may encourage short positions.
Consolidation to Accumulation
Earlier in the summer, OBV moved sideways with a downward change through late June. Notably, the indicator broke out from a triangular consolidation in early July, the first buy signal.
A second breakout followed shortly after as OBV moved above a descending resistance line, indicating a transition from distribution to accumulation. These moves lifted OBV sharply from around 10.25 million to above 12.5 million, confirming strong buying pressure.
Rising Channel and Key Support Levels
Following the July gains, OBV established an ascending parallel channel. The indicator then oscillated between rising support and resistance, indicating continued accumulation. Around mid August, OBV tested horizontal support near 12 million, which held firmly.
That level was noted as an area where buyers defended positions, maintaining the upward structure. However, OBV has since retreated from recent highs near 13.25 million and is now testing the channel’s lower edge at 12.75 million.
Analyst Outlook and Price Resistance
According to Lennaert Snyder, Ethereum faces pressure while trading under the $4,250 resistance level. He emphasized that reclaiming this level is required to lead to fresh momentum. Failure to do so, he explained, could lead short positions and deeper retests.
The analyst added that losing nearby support would encourage continuation shorts, stressing that long positions should only be taken on confirmed reversals. This aligns with the current OBV setup, where 12.75 million is a crucial support point.
