#GatePredictionMarketAddsSmartMoneyTracking

Ethereum Volatility Reaches Lowest Level in Months: Next Rally or Still Downtrend?

Ethereum Price
ETHUSD
is currently trading near $2,120 after losing the lower level of the ascending parallel channel and breaking below the 0.236 Fibonacci retracement at $2,140 last week, so bulls and bears are now divided on the next move.

The Bollinger Band Width percentage is at its lowest in recent months, indicating volatility expansion is imminent. Traders are now watching whether the demand zone around $1,950 will hold or break before the price determines its next direction.

4-Hour Chart Shows Bears Still Dominating the Market

Since April 26, ETH has been moving within a descending parallel channel on the 4-hour timeframe. Currently, the token is at $2,122 and testing the middle line of the channel from below.

If ETH successfully breaks above the middle line, the chance to reach $2,230 will open. This level aligns with the upper boundary of the channel and will also break the short-term daily resistance that traders are watching.

It appears that volume continues to contract as the price attempts to move upward. The Relative Strength Index value is around 55, which is a neutral level and similar to previous failed rebounds within the channel.

Until volume recovers, the market structure still favors sellers. If the price closes below $2,080, it will re-enter the lower half of the channel and the bearish rotation will repeat.

Demand Zone Could Trigger Rebound Toward $2.4k

Not all signals indicate a decline. An analyst believes that ETH is still holding in the daily demand zone between $1,942 and $2,015 and is preparing for a rebound.

“ETH remains above the daily demand zone of 2k-1.9k and is trying to rebound. As long as this zone is broken, we expect a bounce from this area toward 2.4k or higher levels. This bias remains valid as long as ETH stays above the demand zone,” wrote Crypto Candy.

This prediction depends on buyers entering the green block and preventing the price from closing below $1,942. If there is a clear rejection from this zone, ETH is likely to mirror the previous rebound toward $2,463.

Such movement will also push ETH’s daily price back into the upward channel that was broken last week. But if this zone fails to hold, the bullish scenario could be invalidated.

Ethereum Price Prediction Toward $2,382 or Breakdown to $1,920

On the daily chart, both scenarios are clearly visible. Ethereum has broken below the lower boundary of the ascending parallel channel that has held since February 7. The price also broke below the 0.236 Fibonacci retracement at $2,140.

The Bollinger Band Width indicator shows extreme contraction. Usually, such signals are followed by sharp expansion in one direction and rarely last more than two weeks.

If the price manages to reclaim the channel, the next target is the 0.382 Fibonacci level at $2,382, which is the next major resistance. After that, the golden ratio is at $2,772.

However, if it fails to hold above $1,950, the price could head toward $1,920, a strong horizontal support for traders. Deeper pressure could pull the price down to the February swing low around $1,750.

The Relative Strength Index is starting to rise from the bearish zone but is still around 40. This indicates buying momentum has not fully reversed and aligns with the bearish projection already outlined for this quarter.

The next two weeks are likely to be decisive. Whichever side breaks the volatility spiral first will determine ETH’s price direction heading into the third quarter.