The price of ethereum has been on a downward trend for the past few months and is still showing no signs of recovery.
In the past 24 hours alone, eth fell to a monthly low of just over $2,300.
Technical analysis
The daily chart
On the daily time frame, the price has been falling since the breakout of the 200-day moving average, which is located around the $3200 mark. The Relative Strength Index also shows values below 50%, indicating that the momentum is clearly bearish.
As a result, the most likely short-term scenario is for the market to fall towards the $2,100 support zone. Overall, as long as eth is trading below its 200-day moving average, the market trend can be considered bearish.
The 4-hour chart
The eth/USDT 4-hour chart shows a clearer picture of the recent downtrend. After the price lost the $3,000 and $2,700 support zones, it has consolidated above the $2,100 level.
However, in the past few days, the asset has retested the $2,700 level but was rejected to the downside. Considering that the market is now creating lower highs and lower lows, it seems very likely that it will fall back towards the $2,100 level in the coming days.
Sentiment analysis
ethereum Funding Rates
Since the perpetual futures market has a significant influence on the short-term price action of the cryptocurrency market, analyzing the aggregate sentiment of futures traders could provide some clues as to the future direction.
This chart shows eth funding rates, visualizing whether buyers or sellers are executing their orders more aggressively (using market orders) on the futures market.
As the chart suggests, funding rates have fallen back below zero, which is a clear sign of bearish sentiment. However, while not always a good sign, negative funding rates are often one of the initial signals of a market recovery, as they can lead to cascades of short position liquidations. However, this largely depends on whether there is sufficient spot buying pressure.
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