As a seasoned crypto investor with over a decade of experience navigating the volatile digital asset market, I’ve learned to ride the waves and stay adaptable. The recent surge in Ethereum’s price is a welcome sight, but the looming bearish signals have me cautiously optimistic.
To begin the new week, Ethereum‘s price surged by 4%, reaching $2520 during U.S. trading hours on Monday. This upward movement suggested a new wave of optimism among major altcoins, as Bitcoin‘s efforts to reclaim $60,000 were met with resistance. Yet, this upward trend has yet to gather pace, and Ethereum’s bearish indicators suggest potential further declines could follow.
Ethereum Price Faces 22% Drop Amid Death Cross Formation
Over the past week, Ethereum’s price experienced a significant drop from approximately $2820 to $2400, resulting in a 14.9% decrease. This downward shift indicates that the price is holding steady below $2800, a level which had previously served as a strong support for the past five months.
The current market trend has moved from buying during upturns to selling during downturns. The price of ETH is currently trading below its short-term Exponential Moving Averages (EMAs) – 20, 50, 100, and 200 days. This suggests that the easiest direction for the market to move in is downwards. Moreover, a recent ‘death cross’ between the 100-day EMA and the 200-day EMA, which hasn’t occurred in ten months, could potentially boost selling activity among traders.
If the downward trend in Ethereum continues, it’s likely that the price could drop by about 22%, reaching a significant trendline that has been holding since mid-June 2022. A break below this support line would signal a significant change in direction and could initiate an extended period of correction.
As reported by Santiment, there’s been a steady increase in Ethereum held on exchanges since January 2024, amounting to approximately 20.9 million ETH at the current moment. Typically, an uptick in exchange-held Ethereum has been associated with price decreases because traders might be preparing for potential corrections and readying their assets for sale.
For Ethereum (ETH) investors, the upcoming test of the long-awaited support trendline could be crucial, as it previously sparked a significant recovery. Additionally, when the Average Directional Index (ADX) dips below 32%, it usually suggests that the current trend has provided more winning trades for most investors.
Thus, the Ethereum price holds a high potential to rebound and spark a fresh recovery trend.
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2024-09-03 00:01