20% Drop or Renewed Rally for Ethereum (ETH) in the Short Term? Analysts enter

TL;DR

ETH is down 11% over the past month, with analysts warning of a possible further decline to $1,800 if key support levels fail. Others predict a potential rally, citing a “bear trap” pattern and historical trends. More pain for ETH bulls?

Ethereum (ETH) has been one of the worst performing cryptocurrencies (from the top 10 list) lately, with its price falling by 11% on a monthly basis. It’s down 4% in the last 24 hours and is currently trading around $2,300 (according to CoiGecko data).

One popular analyst who believes that ETH’s fall may be far from over is X user Ali Martinez. He described the $2,290-$2,360 range as a “key support” level, where 1.9 million addresses hold roughly $52.3 million of the asset.

The crypto enthusiast believes that ETH could fall 20% to $1,800 if its price falls below this zone. Remember that its valuation briefly fell to $2,260 a few hours ago.

ETH price, Source: CoinGecko

Some on-chain metrics also suggest that Ethereum could experience an additional correction in the near future. An example is the “In the Money” indicator, which is down 0.19% daily. It shows the change in the number of ETH investors who currently have paper profits. As of now, 54% is in the green, while 39% is underwater.

The bullish scenario

Contrary to Ali Martínez’s assumption, many other analysts are optimistic that ETH is poised for a revival. User X Phoenix believes the asset’s chart has formed a “bear trap”, indicating a potential resurgence in the coming months.

JAVON MARKS stated that Ethereum’s pattern appears to have mirrored that of 2023, leading to a 165% price increase.

“2023 appears to have been the template for another massive upside that may soon occur in this crypto market. The target is $4,723.5, and a break above may welcome more than $8,100 into play, projecting another close to double, if not much, much more,” the analyst argued.

Last but not least, ETH’s RSI has recently plunged to a bullish ratio of around 30. The Relative Strength Index (RSI) helps traders assess overbought or oversold conditions and, therefore predict possible price reversals. Readings below 30 generally indicate that ETH is oversold, which could be a precursor to a rally. Conversely, a ratio above 70 could be interpreted as bad news for the bulls, as it may be followed by a correction.

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