Ethereum’s price has been on a downward spiral, failing to break the $4,000 resistance level for the second time and subsequently dropping below the 200-day moving average. The daily chart shows a clear downtrend, with the price making lower highs and lows, and the 4-hour chart indicates a brief recovery above the $3,000 support level, but lacking momentum to continue higher.
The on-chain analysis suggests that the market may be entering a capitulation phase, as the Ethereum Exchange Reserve metric has increased above its 30-day moving average, indicating a potential increase in selling pressure. This could be a sign that many investors’ stop losses were triggered below the $3,000 level, leading to a further decline in price.
In the short term, analysts are warning of a potential drop to the $2,700 support level, as the price seems to be getting rejected to the downside. This could be a buying opportunity for investors who are willing to take on risk, but it’s essential to keep in mind that the market is highly volatile and subject to sudden changes.
For investors who are holding Ethereum, it’s crucial to set stop-losses and consider taking profits or reducing their exposure to the market. For those looking to enter the market, it’s essential to wait for a clear reversal pattern or a strong buying signal before making a move.
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Source: CryptoPotato
