As a seasoned crypto investor with several years of experience under my belt, I find the current Ethereum (ETH) price situation intriguing. Although the ETH price saw selling pressure last week and is now stabilizing around $3,700, the on-chain indicators continue to show strength, suggesting buying pressure on the upside.
Last week, Ethereum (ETH) experienced some downward pressure and its price dipped to around $3,700. However, recent developments indicate that the cryptocurrency may be regaining stability in this price range. Meanwhile, underlying Ethereum network data suggest that buyers are showing renewed interest, potentially setting the stage for further price increases.
Surge in Ethereum Whale Addresses
Crypto expert Ali Martinez has noted an approximately 3% growth over the past three weeks in the number of Ethereum wallets containing 10,000 or more Ether. This expansion implies a substantial surge in demand for Ethereum.
As an analyst examining on-chain data from Santiment, I’ve noticed a significant surge in Ethereum enthusiasm following the SEC’s approval of Ethereum ETFs. Initially, this excitement led to a heightened social sentiment surrounding the cryptocurrency. However, after this initial spike, sentiment has now stabilized. This stabilization is considered an ideal state preceding the actual trading commencement for these new Ethereum financial products.
ETH Price Action Ahead
Some market analysts, including Caled Frazen, have pointed out that Ethereum’s price behavior now resembles its pattern from 2021, leading them to suspect a potential price surge of around 83% similar to what occurred then.
Despite warning against taking historical patterns literally (“history may rhyme, but it doesn’t repeat”), Frazen highlighted the importance of identifying similarities between past and present events. In reference to the 2021 market cycle, the “red zone” emerged as a pivotal level, albeit not without imperfections. Following a failed decline, Ethereum experienced an impressive surge of over 83% within just 50 days.
According to the Coingeasiness chart shown here, Ethereum (ETH) open interest dropped from $16.97 billion on June 6 to $16.35 billion as of the most recent data on June 9, representing a decrease of approximately $620 million.
As a crypto investor, I’ve noticed that ETH‘s price took a 7.38% hit from its peak on June 6. However, the decrease in open interest was relatively mild, shrinking by only 3.65%. This is almost half of the percentage decline in ETH’s price.
During a market downturn, a slower decrease in open interest compared to the price decline could be seen as a potential bullish sign for two key reasons.
As a crypto investor, if Ethereum ($ETH) falls below the crucial support level of $3650 on the price chart, I would be cautious and prepare for a potential downturn. The next significant support zone lies around $3152, which previously acted as a resistance level, forming what’s known as a Fair Value Gap (FVG).
If Ethereum maintains its position above $3650, it may indicate a promising upward trend towards hitting the $4000 mark. Breaking through this resistance level could ignite a significant bullish momentum, potentially propelling Ethereum’s price into the $6000-$7000 range.
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2024-06-10 09:34