The current state of the crypto markets
Bitcoin has recently experienced a significant drop, falling below $92,000 as it struggles to maintain its gains. This has had a ripple effect on Ethereum, with the token expected to lose support at $300 following a rejection from $4100. The lack of trader interest in Ethereum is evident in the declining transaction count and volume.
Understanding active address count
Active address count is a key indicator that reflects the level of activity on a platform, which can impact the token’s volatility. An increase in active addresses typically signifies a rise in trading activity, which can either push the price up or down. However, Ethereum has been experiencing a decline in active address count since the end of 2024, leading to lower highs and lows in the market.
This decline in trader participation has also resulted in a drop in transaction count. As a result, the price is expected to remain in a consolidation phase, with a potential 10% pullback looming on the horizon.
The future of Ethereum price action
Looking ahead, the weekly price action indicates that Ethereum is likely to test the support zone below $3000, ranging between $2929 and $2814. However, a rebound is expected once this support level is reached, potentially pushing the price back up to $4000. This could complete the inverse head & shoulder pattern, setting the stage for a substantial 50% upswing towards new highs above $6500.
Historically, Ethereum has seen a 60% pullback after breaking down from the neckline of a head & shoulder pattern, resulting in lows below $1000. Therefore, a reversal of this trend could trigger a similar upswing, potentially leading to a new all-time high in the near future.