Ethereum (ETH) is currently facing a bearish trend and is anticipated to experience a price decline in the near future. This is primarily due to several factors such as its underperformance compared to top assets like Bitcoin (BTC) and Solana (SOL), recent sell-offs by whales, and the formation of a bearish price action pattern.
The sluggish performance of Ethereum (ETH) has raised concerns among investors and whales, leading to significant sell-offs in recent days. A notable incident was reported where a dormant whale holding 398,889 ETH worth $1.34 billion offloaded 73,356 ETH valued at $224 million. This massive dump has created selling pressure on the asset and has shifted user sentiment towards a more bearish outlook.
Technical analysis of Ethereum (ETH) reveals a bearish double-top price action pattern along with bearish divergence on both daily and four-hour charts. Historically, assets exhibiting these patterns tend to experience substantial price declines. If ETH closes a four-hour candle below the $3,250 level, it could potentially drop by 8% to reach the $3,010 level in the coming days.
Despite the bearish signals, Ethereum is currently trading above the 200 Exponential Moving Average (EMA) on the daily timeframe, indicating an ongoing uptrend. The Relative Strength Index (RSI) also suggests that the asset still has room for a price increase in the near future. However, the bearish outlook for ETH will only be invalidated if it breaches and closes a four-hour candle above the $3,400 level.
On-chain metrics further support the bearish sentiment surrounding Ethereum. According to Coinglass, ETH’s Long/Short ratio stands at 0.90, indicating strong bearish sentiment among traders. Additionally, the open interest in ETH has dropped by 5.4% in the past four hours and 1.75% over the past 24 hours, signaling a decline in trader interest and liquidation of open positions.
As of now, Ethereum is trading near $3,315 with a 2.1% price decline in the past 24 hours. The trading volume has also decreased by 29%, indicating lower participation from traders compared to the previous day.
In conclusion, Ethereum (ETH) is currently facing a bearish outlook with various indicators pointing towards a potential price decline in the near future. Traders and investors are advised to closely monitor the price action and on-chain metrics to make informed decisions regarding their ETH holdings.