Ethereum (ETH) has been making headlines recently as the world’s second-largest cryptocurrency by market cap. However, there are signs that the digital asset may be facing a potential price decline in the near future. This comes after a period of bearish price action and a lack of interest from whales and industry experts, as indicated by on-chain analytics firms IntoTheBlock and CryptoQuant.
The recent price surge of over 15% saw ETH hit the $4,100 mark for the first time since March 2024. However, this level has historically been a point of resistance for Ethereum, with the cryptocurrency facing selling pressure and a subsequent price decline each time it reaches this milestone.
One concerning factor is the rising exchange reserves of ETH, with whales and long-term holders depositing their tokens onto exchanges. CryptoQuant’s ETH exchange reserve metrics show an increase of nearly 100k ETH, equivalent to $400 million. This influx of tokens on exchanges could signal increased selling pressure as ETH approaches a six-month high.
In addition to the rising exchange reserves, there has been a noticeable uptick in unstaking activity among whales. This suggests that large holders are either taking profits following the recent price surge or losing interest in holding ETH long-term. A recent example of this is Justin Sun, the founder of Tron, who withdrew 52,905 ETH worth $209 million from the staking protocol Lido Finance.
From a technical analysis perspective, ETH appears to be forming a bearish double-top pattern at the $4,100 resistance level. The Relative Strength Index (RSI) for Ethereum is also falling, indicating a bearish divergence and potential price decline. Experts predict that ETH could drop by 12% to reach the $3,500 level in the future based on this analysis.
As of now, ETH is trading near $3,970 with a modest price decline of 0.80% in the past 24 hours. Despite this, trading volume has increased by 60%, suggesting heightened participation from crypto enthusiasts amid the recent price surge.
In conclusion, Ethereum’s price outlook is uncertain, with indicators pointing towards a potential decline in the near future. Traders and investors should keep a close eye on market trends and developments to make informed decisions regarding their ETH holdings.