Ethereum’s price has been struggling to attract buying demand in the past few hours, leading to an increase in selling pressure. This has caused more traders to start selling their positions, which could potentially result in large liquidations and a further drop in Ethereum’s price.
Recent on-chain data indicates that Ethereum has experienced a sharp decline in price, with significant liquidations amounting to over $117 million. Buyers lost around $72.24 million, while sellers had to close approximately $44.7 million in short positions. This selling pressure has intensified as Ethereum failed to break above key resistance levels, putting downward pressure on the price.
Coinglass data also reveals that there is a potential risk of $6 billion in long positions if Ethereum’s price falls to $4,200. A heatmap of liquidation points shows a cluster of trades that could be forced to close if prices continue to decline, leading to further selling pressure.
Currently, more traders are betting on Ethereum’s price to decrease rather than increase, with a long/short ratio of 0.8447. Market makers may attempt to push prices higher to trigger stop-losses or liquidate short positions, potentially driving the price up to $4,500.
On the other hand, demand for Ethereum remains strong from companies holding large amounts of ETH in their treasuries. BitMine recently announced an increase in its ETH holdings by $1.7 billion, bringing the total to $6.6 billion. This significant buying activity creates upward pressure on the price, indicating positive sentiment towards Ethereum.
As Ethereum continues to fall below key support levels, short-term traders are likely taking profits. The current price of ETH stands at $4,205, reflecting a 2% decline in the last 24 hours. The next crucial level to monitor is $4,143, where a strong bounce could indicate buyers stepping in to establish a new support zone. If Ethereum surpasses $4,777, it could potentially reach $5,000.
However, if ETH falls below $4,143 and remains there, a deeper pullback could be anticipated. The price might drop to around $3,800 and potentially down to the 50-day moving average at $3,556. Traders should closely monitor these key levels to gauge the future direction of Ethereum’s price movement.