- Ethereum recovered out of the liquidity range at $3,800, confirming that the demand was strong, and it is still below the resistance of 4,060 outliers, which means that traders are interested in short-term momentum.
- A break and close above this level of $4,060 would turn resistance into support and potentially cause rallies to $4,265 and continue the momentum to the $4,750 levels.
- Failure to regain that of 4,060 may put Ethereum at risk of another dip, retesting 3,800, and potentially extending down to the 3,600 pocket.
Ethereum ($ETH) recently rebounded from a sharp sell-off after tapping the $3,800 liquidity zone. The asset now trades below the $4,060 level, which has become the central resistance for determining the next directional move.
Bounce from $3,800 Liquidity Zone
Ethereum’s price action shows a clean reaction at $3,800, a zone often associated with liquidity sweeps and stop hunts. According to market analyst Ted Pillows, this level acted as a magnet for heavy trading activity. ETH quickly returned to $3,900 after hitting the zone.
Even with the rebound, Ethereum is still in a fragile situation. The relief rally has not yet restored former support levels. The inability to hold above key resistance leaves uncertainty in the market. Traders are now closely watching if the bounce can extend higher.
The $3,800 tap confirmed the demand zone remains relevant for near-term positioning. If retested and broken, the level could expose lower liquidity areas. This sets the stage for a decisive move in either direction.
Battle at $4,060 Resistance
The $4,060 region has shifted from support to resistance, becoming the defining level for Ethereum’s next move. Ted noted that ETH must reclaim this barrier to trigger bullish momentum. Only then could the price sustain an upward trajectory.
A daily close above $4,060 would open the way to $4,265. On top of that, the push may take the trend even higher to $4,750 as long as the volume backs the trend. Traders are closely assessing whether the recent rebound provides the strength needed for continuation.
Failure at this resistance would suggest the market lacks conviction. Rejection from the level could invite further downside pressure and weaken near-term optimism. The next candles are being closely monitored for confirmation.
Bearish Scenario Below Key Levels
If Ethereum fails to reclaim $4,060, bears may regain control. Ted stated that rejection could lead to a revisit of $3,800 support. This would mark the second test of the liquidity pocket within a short timeframe.
A breakdown of the $3,800 zone could accelerate losses. In that case, ETH would likely target the $3,600–$3,550 range as the next downside pocket. That area contains the next cluster of liquidity, making it a probable destination for sell-side pressure.
The setup remains a textbook inflection point. Ethereum must either reclaim lost support or risk further losses. Both scenarios carry high risk, and traders await confirmation.
