ENA’s Struggle at Resistance Raises Concerns of a Deeper Fall

Key Takeaways

• Ethena (ENA) has formed a bearish pattern at resistance.
• The price is developing a bearish engulfing candlestick.
• If this bearish pattern is confirmed, ENA could see new lows.

ENA’s performance in 2024 was marked by stark contrasts between the first and second halves of the year.

After reaching an all-time high in April, the price plummeted by 90%, wiping out most of its earlier gains. However, ENA experienced a dramatic resurgence in August, surging by over 550% by year-end.

Despite this impressive rebound, ENA fell short of setting a new all-time high. While initially not concerning, the formation of a bearish double-top pattern raises questions about the token’s future.

The key question now is: Can ENA recover, or is a deeper decline on the horizon?

ENA Creates Bearish Pattern

Since August, ENA’s rally has been nearly parabolic, with only a minor retracement in October.

After a brief dip in December, the price regained momentum as 2025 began, sparking hopes of a new all-time high.

To achieve this, ENA needed to break through the $1.25 resistance area. However, this week’s decline has raised concerns about the sustainability of the bullish outlook.

ENA has formed a bearish double-top pattern (black icons), solidifying the $1.25 resistance. Additionally, a bearish engulfing candlestick is taking shape, which could erase all of last week’s gains.

The Relative Strength Index (RSI) also signals weakness, showing a bearish divergence (green), further supporting the double-top pattern. The next key support area is around $0.90 at the base of the pattern.

If the double top plays out, ENA’s price could decline to the 0.5-0.618 Fibonacci retracement support zone, which spans between $0.63 and $0.76.

When Will ENA Bottom?

The daily time frame aligns with the bearish outlook indicated by the weekly chart. The current wave count suggests ENA is in the fourth wave of a five-wave rally (white). Given that wave three extended, wave four is likely to be longer, as seen in the sub-wave count (black).

Since wave three extended, wave four is expected to be longer in response. The sub-wave count (black) suggests a potential low of $0.76, reaching the 0.5 Fibonacci retracement support level.

While it’s possible ENA could form an ascending triangle for wave four, the bearish A-B-C scenario seems more likely due to the previously identified double-top pattern.

Both the RSI and Moving Average Convergence/Divergence (MACD) indicators have generated a bearish divergence, further confirming the bearish forecast.

Once the correction is complete, ENA could potentially enter the fifth and final wave, which could bring the price to a new all-time high.

Downside Before Upside

ENA’s price failed to break out from the $1.25 resistance area and created a double-top pattern. The bearish pattern aligns with the wave count, which predicts a lower low. So, ENA could dip again, possibly reaching $0.76 before eventually resuming its ascent to new highs.