ethereum has been noticeably bearish, marked by a sharp drop following a pullback to the lower boundary of a broken wedge, along with the formation of a death cross.
Despite this, the price is approaching a crucial support level that could lead to a short-term sideways consolidation.
By shayan
The daily chart
ethereum has been in a strong downtrend, which has created fear and uncertainty among market participants. Low inflows into eth spot ETFs have further underlined this sentiment, indicating lower investor interest and the emergence of the death cross, where the 100-day moving average crosses below the 200-day moving average.
Following a rejection at the lower boundary of the multi-month wedge and the 0.5-0.618 Fibonacci levels, ethereum has continued its decline, confirming the strength of sellers in the market.
However, the price is approaching a critical support zone, defined by the static $2.1K level and the 0.786 Fibonacci retracement level at $2,067. This area is expected to see substantial demand, which could lead to a short-term pause in the downtrend, with possible sideways consolidation before ethereum’s next move is determined.
The 4-hour chart
On the 4-hour chart, eth was firmly rejected from the resistance zone between the 0.5 ($2.6K) and 0.618 ($2.7K) Fibonacci levels, resulting in continued bearish momentum towards the $2.1K support. This level has held previously, particularly in early August, suggesting that it could attract buyers looking to accumulate at these price points.
If demand resurfaces at the $2.1K mark, ethereum may experience a temporary consolidation phase, halting the bearish pressure. However, if this crucial support is broken, it could trigger an extended sell-off event, which could push the price down towards the $1.8K region.
The next few days will be crucial in determining whether ethereum can hold this support or if a deeper correction is on the horizon.
By shayan
ethereum’s value is fundamentally tied to its decentralized network and the active participation of its users. A key metric for measuring this participation is the number of unique active addresses on the network, which can serve as a valuable indicator of ethereum’s overall market demand and valuation.
The chart shows the 14-day moving average of ethereum active addresses, which represents the total number of distinct active addresses, including both senders and receivers of eth transactions. Since late March 2024, this metric has been rapidly declining, highlighting a drop in user activity and transaction volumes.
This downward trend reflects bearish sentiment in the market, with reduced demand and lower investor participation. For ethereum to recover and potentially embark on a sustainable long-term rally, this trend must reverse. A resurgence in the number of active addresses would indicate growing interest and accumulation of ethereum, which would signal stronger demand and the possibility of a bullish market reversal.
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