Ethereum’s price has experienced a slight dip of nearly 5% after reaching a new all-time high of $4,946 earlier today. The leading altcoin by market cap has seen a significant rally in August, with a price surge of over 21% before settling at $4,713 as of the latest data. This marks a 26% increase since the beginning of the month and a remarkable 220% rise from its year-to-date low.
However, despite the strong performance in August, historical data suggests that Ethereum could face a bearish trend in September. Analysis from CoinGlass reveals that in previous years when ETH recorded gains in August, it was often followed by a decline in September. For instance, in August 2017, 2020, and 2021, Ethereum saw significant gains but experienced subsequent declines in September.
The recent drop in Ethereum’s price from its all-time high can be attributed to a wave of long liquidations, with overleveraged positions being flushed out near the peak. Total liquidations for ETH in the past 24 hours amounted to $216 million, with a major portion coming from long positions.
Looking ahead, Ethereum may face further downside pressure if it fails to break above the $4,900 level, which is currently a dense liquidation zone. A renewed attempt to move higher could trigger another cascade of liquidations, potentially pushing the price towards the $4,600–$4,680 range.
On a positive note, Ethereum is operating in a different macro environment compared to previous cycles. The introduction of spot Ether ETFs and increased corporate treasuries holding ETH have added a new dynamic to the market. Institutional investors have shown strong demand for Ether, with Ether funds attracting significant inflows in August.
Technically, Ethereum is trading within an ascending parallel channel on the daily chart, indicating a continuation of the bullish trend. The token is currently consolidating near the midline of the channel, with short-term momentum favoring the bulls. Key indicators such as the Supertrend and Relative Strength Index suggest that bullish momentum is still intact, with potential for further upside.
If Ethereum maintains its bullish momentum, the next major resistance level is at $5,200, representing a 10% gain from the current price. A breakout above this level could signal further upward movement, especially with strong volume support. On the downside, immediate support lies at $4,349, with a break below potentially leading to a deeper correction towards the lower boundary of the channel.
It is important to note that this article does not constitute investment advice and is intended for educational purposes only. As Ethereum navigates through potential challenges in September, investors should closely monitor market developments and adjust their strategies accordingly.