Ethereum Name Service (ENS) has seen a dramatic surge in recent days, with the token gaining an impressive 110% over the past ten days. The rally has allowed ENS to break past significant resistance levels, including the local highs at $34.6, which was flipped to support last week. The recent surge has prompted traders to watch closely for the next move, as the $40 level has now turned into a potential demand zone.

ENS Price Surge: Breaking Resistance Levels

The recent price action for ENS has been nothing short of impressive. In the past week, the token has not only surpassed key resistance levels but has also maintained its bullish momentum. After breaking through the $34.6 resistance, ENS quickly retested the $40 mark, where bulls worked hard to establish it as support. At the time of writing, ENS was trading near the $40 zone, a critical level that will likely dictate its near-term price movement.

The Role of Market Indicators and Technical Analysis

On the daily chart, key levels such as $38.4 and $49.8 are highlighted, as these were critical price zones during November and December 2021. Currently, ENS has surpassed the 23.6% Fibonacci extension level, indicating that the price is moving in a strong upward direction. However, despite the bullish structure, there are signs of weakening momentum.

The Chaikin Money Flow (CMF) indicator shows a positive reading of +0.1, which highlights significant capital inflows into the ENS market. This suggests that, at least for now, buying interest remains strong. However, the Awesome Oscillator, which measures bullish momentum, has shown the highest levels of the year, but the histogram has started to display a red bar. This indicates that while momentum is still positive, it may be starting to wane.

Additionally, the Stochastic RSI has formed a bearish crossover, which further signals the potential for a price dip in the short term. These indicators point to the possibility of a pullback, even though the overall market structure remains bullish.

Short-Term Consolidation and Liquidity Zones

In terms of short-term price action, ENS seems to be consolidating in the $38–$42 range. After reaching the $46 resistance level, the price faced rejection and is now trading in a narrower range around the $40 mark. There is a notable decrease in Open Interest (OI), as well as a drop in the spot Cumulative Volume Delta (CVD), indicating that demand may be weakening in the spot market, particularly in the lower timeframes.

A key liquidity zone has been identified around the $39.2 level. This could act as a potential support area if the price retraces further. Given that long positions have been punished with each dip below the $40 level, traders may want to keep an eye on this liquidity cluster for potential buy opportunities if the price does pull back.

Conclusion: Will ENS Maintain Its Momentum?

ENS has delivered an outstanding performance over the past ten days, with the token surging by 110%. The market structure remains bullish, and the token has established key support levels at $38 and $40. However, as the Awesome Oscillator and Stochastic RSI show signs of weakening, there is a possibility of a short-term pullback.

Traders should remain vigilant and watch for price action around the $38–$42 range, as well as the liquidity cluster around $39.2. If the price manages to hold these levels, there is potential for another breakout toward higher resistance zones. Conversely, if the $40 level fails to hold, ENS could see a deeper retracement.

Overall, while the immediate outlook for ENS remains bullish, the weakening momentum suggests that a price dip may provide opportunities for buyers in the coming days.