As a seasoned researcher with years of experience navigating the volatile world of cryptocurrencies, I find myself constantly intrigued and challenged by the ever-changing landscape of the market. The latest developments in Ethereum’s price action have caught my attention, particularly the rejection at the $2.6K resistance and the subsequent bearish signs on both the daily and 4-hour charts.
The fact that Ethereum hasn’t been able to surpass the $2.6K mark, which is the middle line of its multi-month downward channel, suggests a strong rejection and potentially more falls towards the intermediate support level of $2.1K. In simpler terms, Ethereum might be heading further down due to this recent failure to rise above $2.6K.
Technical Analysis
By Shayan
The Daily Chart
As I observe and analyze the day-to-day fluctuations in Ethereum’s value, it appears that we may have fallen into a bull trap. Momentarily exceeding the $2.6K resistance level, the price experienced a brief surge only to swiftly lose momentum under the weight of significant selling pressure, resulting in a 15% plunge.
This refusal emphasizes the strength of sellers in the market, as ETH was unable to surpass this significant barrier. Furthermore, contributing to the pessimistic mood, a “Death Cross” has taken place, where the 100-day moving average fell below the 200-day moving average, which is typically a bearish indicator from history.
As an analyst, I’m anticipating that the market could see a potential retreat towards the $2.1K support area, which lines up with a notable previous low point. This suggests Ethereum might be entering a period of descending consolidation, gradually moving downwards over the mid-term to reach this critical level.
The 4-Hour Chart
As an analyst, I’ve noticed on the 4-hour chart that Ethereum’s attempts to sustain momentum around the Fibonacci levels at approximately $2.6K (0.5) and $2.8K (0.618) have led to a substantial drop, approaching the lower boundary of the ascending flag at roughly $2.3K. At present, Ethereum is holding steady near this support level, indicating low volatility and a period of sideways consolidation, suggesting uncertainty in the market regarding its next move.
Even though neither buyers nor sellers currently hold direct control, their collective efforts seem to be pushing the price towards falling below the flag’s lower limit, indicating a bearish trend.
Should Ethereum fall beneath its current level, it might initiate a prolonged downward movement towards the significant $2K barrier for support. Nevertheless, the $2.1K barrier stands as a vital line of defense for sellers to halt any potential additional drops.
Onchain Analysis
By Shayan
The provided chart highlights a stark contrast between the performance of Bitcoin and Ethereum ETFs over the 79 days since their launch. The divergence in investor behavior suggests different demand and confidence levels between these two cryptocurrencies, with Bitcoin showing substantial inflows and Ethereum struggling to attract interest.
By Day 79, Bitcoin ETFs have seen a total inflow of approximately $29.1 billion, with the total assets under management rising from an initial $29.2 billion to a peak of $58.3 billion. This surge has since leveled off around $59.7 billion. This growth trend suggests a sustained and consistent interest in Bitcoin among investors.
Conversely, there has been a total withdrawal of approximately $4.1 billion from Ethereum Exchange-Traded Funds (ETFs) during this timeframe, causing their Assets Under Management (AUM) to decrease from $10.7 billion to $6.6 billion.
The persistent drop indicates low investor interest in Ethereum, a key player within the larger crypto scene, compared to ETF investors. This pattern hints that Bitcoin, with its stability and institutional backing, is currently preferred over Ethereum in ETF investment products. However, Ethereum can recover its position by addressing immediate market worries.
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2024-10-10 16:37