Ethereum Price Analysis: ETH Faces Moment of Truth as It Struggles to Break Above $2,000

Yesterday, the Federal Reserve kept interest rates unchanged as expected. The market rallied ahead of the Fed’s meeting but the uptrend started to show signs of exhaustion right after Chairman Jerome Powell’s speech.

The head of the central bank reassured market participants as he confirmed that two interest rate cuts are still scheduled to take place this year.

Although this is not an improvement from the market’s perspective, it is good news as Trump’s hostile measures on the trade front raised concerns that the Fed could adopt a more conservative approach amid fears that these decisions could result in higher inflation in the U.S.

ETH has recovered slightly in the past week, delivering gains of 5.2% during this period. However, the native asset of the Ethereum network is still the worst-performing crypto in the top 5 this year with annual losses of 40.2%.

Trading volumes in the past 24 hours have surged by 13% as President Donald Trump prepares to give a video speech during the Digital Asset Summit in New York City at 10:40 AM ET.

Market participants will keep an eye on the President’s comments as he often makes bold announcements that cause a spike in volatility.

ETH Breaks Above Falling Wedge as Positive Momentum Picks Up

The daily chart shows that positive momentum is picking up for ETH amid a bullish breakout of a falling wedge.

This technical pattern typically anticipates a trend reversal and, once the breakout is confirmed, the price could rally significantly. Momentum indicators have confirmed a bullish outlook as the Relative Strength Index (RSI) moved above the signal line.

Meanwhile, the MACD’s histogram shows steadily increasing positive momentum readings. Although the price has been going down during the Asian session, this could just be a normal profit-taking move and the decline has not yet invalidated the falling wedge’s bullish bias.

Although both the prevailing trend is bearish and market sentiment remains heavily depressed, this could be an early sign of a reversal that may be confirmed if ETH breaks above the $2,000 psychological resistance during the American session.

Bulls Are Trying to Recapture the $2,000 Level Already

Moving to the hourly chart, we can see that the price action rejected a move above $2,000 already and this failed breakout rapidly triggered a decline. Now the price has made one lower high already and it is currently retesting a key support/resistance level.

The Relative Strength Index (RSI) broke below the signal line after the $2,000 breakout was rejected and has been on a downtrend since then. Meanwhile, the MACD’s histogram is in negative territory although negative momentum seems to be decelerating.

The American session will determine ETH’s fate along with whatever Trump says during his upcoming speech. If ETH breaks above the $2,025 level, it could rally toward the $2,100 area next.

A long position right above $2,025 once the breakout is confirmed would offer an attractive risk-reward ratio of 1.9 if the $2,000 level acts as a floor during the American session. The exit price would be set at $2,100 for a 4% gain.

The RSI is currently retesting the signal line. A break above would also confirm a bullish outlook for ETH.