Ethereum’s recent drop to $1,551 raises concerns.
Ethereum’s trading volume increased 119% in the past 24 hours.
Ethereum, the second-largest cryptocurrency by market capitalization experienced a significant downturn by hitting $1,551, nearing a seven-month low. This drop comes after a challenging week in which it declined by over 8%. The Ethereum community is reeling from this shock, especially considering that ETH began October by breaking the resistance level of $1,700, only to find itself under intense bearish pressure now.
Adding to it, a prominent crypto data aggregator, Santiment, reported that Ethereum has become a polarizing topic with its price performance—its social dominance hit a seven-month high. At its lowest fee levels of 2023, traders are growing increasingly impatient. Despite this, the trading volume has surged by 119% in the past 24 hours, reaching $7 billion. Some traders view the rising bearish sentiment as a potential sign of an impending turnaround.
Several factors have played a role in this price decline. Ethereum’s co-founder, Vitalik Buterin, notably conducted significant sell-offs of his holdings. Additionally, the Ethereum Foundation (0x9e…313d) executed a sale of 1.7k ETH on Uniswap at 16:18 (UTC+8). It resulted in 2.738 million USDC. The address now retains 240.68 ETH, 3.238 million USDC, 49,700 DAI, and 10,000 ARB, totaling assets worth $3.687 million.
Moreover, the launch of futures-based exchange-traded funds (ETFs) for Ethereum on the Chicago Mercantile Exchange (CME) and Chicago Board Options Exchange (CBOE) on October 2 proved underwhelming. As with less than $10 million in combined assets under management during the first week of trading.
Data from Arkham Analytics reveals that an address associated with Vitalik Buterin has sent 3,999 ETH to exchanges in the past five weeks. It amounts to approximately $6.4 million. This substantial movement has fueled speculation within the community regarding its motivations, given the magnitude of the sale.
Will The ETH Bulls Take Over?
A closer analysis of Ethereum’s current price movements reveals bearish forces. The 9-day exponential moving average (EMA) has risen above the current trading price, settling at $1,656. At the same time, the daily relative strength index (RSI) stands at 41, indicating that the asset is nearing oversold territory.
ETH Price Chart, Source: TradingView
As Ethereum has broken below the crucial support level at $1,600, traders are closely monitoring the next significant support levels at $1,548 and $1,526. Conversely, if Ethereum manages to breach the resistance at $1,650, it could open the door for a retest of the $1,735 level.
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