Ethereum has been struggling to maintain its leading position among other cryptocurrencies in the market. The bearish trend affecting the entire cryptocurrency sector has particularly impacted ETH. In the past month, Ethereum experienced a decline of over 11%, suggesting it is losing steam compared to Bitcoin. As the Bitcoin halving event approaches in April 2024, there’s great excitement within the crypto community about whether Ethereum’s price will recover. Let’s delve deeper to assess its potential prospects.
Market Performance of Ethereum Price
Over the past day, Ethereum’s price dipped by 5.19%, down to $3,086.39. This decline was noticeable as ETH saw drops of 14.27% in the last week and 11.36% over the past month. According to CoinMarketCap, Ethereum holds the second-largest cryptocurrency spot with a market capitalization of $371.15 billion. However, its trading volume also saw a decrease of approximately 5.86%, amounting to $21.77 billion in the last 24 hours, indicating reduced liquidity and waning trader interest. Ethereum hit an all-time high of $4,891.70 on November 16, 2021. Since then, its price has plunged by around 36.67%.
Factors Determining the Recovery of Ethereum Price
Various factors play a role in the recovery of ETH price as discussed below.
1. Bitcoin Halving
The Bitcoin Halving, which occurs approximately every four years, significantly influences the crypto market. This event can impact Ethereum (ETH) pricing in various ways. Initially, the halving reduces the number of new Bitcoins entering circulation, potentially increasing demand due to scarcity. Consequently, if Bitcoin’s price rises post-halving, anticipation and interest in the crypto market may cause ETH and other cryptocurrencies to experience price surges as well. Additionally, the buzz and speculation surrounding Bitcoin halvings can lead investors to explore alternative investments like Ethereum, potentially boosting their value.
2. Ethereum ETFs
The growing interest from large investors and corporations towards Ethereum could result in price stability and potential increases. Potential debuts of Ethereum ETFs in May, 2024 might significantly increase Ethereum’s worth, mimicking Bitcoin ETFs’ impact. However, analysts express concerns about SEC approval, which may drop from a probable 70% to 30% due to regulatory silence. Investors are advised to exercise caution regarding Ethereum ETF approvals expectations.
3. General Cryptocurrency Market Recovery
A strong comeback of the cryptocurrency market could cause Ethereum’s price to rebound for several reasons. Initially, as investor trust is restored with the market’s resurgence, more people might consider investing in Ethereum. Second, as funds flow back into crypto assets, Ethereum often gets included due to its popularity and applications. Moreover, Ethereum tends to mimic Bitcoin’s price movements, meaning when Bitcoin recovers, so does Ethereum. Furthermore, the market recovery could lead to higher liquidity and trading volume, making price swings less erratic and potentially pushing Ethereum’s price upwards. Lastly, renewed enthusiasm for blockchain technology and decentralized applications could fuel greater demand for Ethereum, while institutional investors may find themselves drawn to it during the market rebound.
4. ETH’s Price Forecast
Both the Exponential Moving Average (EMA) and Simple Moving Average (SMA) show that short-term periods of 10, 20, and 30 days are signaling a bearish trend based on technical indicators. The Ethereum price is below thes moving averages, showing the possibility of a price drop in the short-term.
Similarly the EMA and SMA for extended durations like 50, 100, and 200 days are also indicating a downward trend. indicating a bearish direction. The current price of ETH is below these moving averages, showing that the overall price movement of Ethereum remains bearish.
The MACD with 12 and 26 periods is giving a Buy signal, suggesting a possible short-term turnaround.
The MACD, which is a momentum indicator, calculates the variance between two moving averages, and the Buy signal could indicate a slight move towards an upward trend for ETH.
However, there is a Sell signal shown by the EMA across different time periods, ranging from 10 days to 200 days. This indicates that Ethereum’s price might keep experiencing downward pressure in the near to medium future. The RSI (Relative Strength Index) at 37.6 is in the neutral range. It indicates that ETH’s price is neither overbought or oversold, suggesting there may be potential for a price reversal if the RSI moves further towards either extreme.
If the Ethereum (ETH) price falls, it may find support at $2698.5. Should the decline continue past that point, another key support level can be found at $2361.2. However, if the bulls cannot defend the $2698.5 support, the price could drop further.
Conclusion
In the face of challenges and downturns, Ethereum’s price demonstrates signs of possible recovery and a chance for a resurgence. The upcoming Bitcoin halving and potential Ethereum ETF approvals could boost Ethereum’s price. Additionally, the overall crypto market recovery might help reverse Ethereum’s downward trend. Keeping an eye on crucial support and resistance levels, as well as shifts in technical indicators like RSI, EMA, and MACD, is essential for investors to identify any momentum changes. Ethereum’s future prosperity depends on numerous factors, so staying informed and cautious is vital for investors.
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2024-04-16 15:26