Ethereum (ETH) has experienced a significant 10.3% decline from its recent highs, causing concern among analysts and investors who fear that the cryptocurrency may be on the brink of another correction.
The recent market downturn has seen ETH struggle to reclaim key resistance levels following a sharp drop from the $2,600 zone to the $2,300 mark earlier this week. This has left the cryptocurrency hovering between the lower and higher range of that support level, prompting worries about its future performance.
Adding to the bearish sentiment surrounding Ethereum, reports have emerged of large investors moving their tokens, causing further alarm within the community. On-chain analytics firm Lookonchain revealed that an Ethereum Initial Coin Offering (ICO) participant recently deposited 12,010 ETH, valued at $31.6 million, to Kraken after being inactive for two years. Additionally, the same address sold another 19,000 ETH, approximately $47.54 million, just two days ago.
Further fueling concerns, crypto analyst Ali Martinez highlighted that a staggering $259.2 million worth of ETH was sent to crypto exchanges on October 3 alone. This influx of ETH to exchanges, totaling 108,000 ETH in the last 24 hours, has raised fears of significant selling pressure on the cryptocurrency in the near future.
Despite the current challenges facing Ethereum, some market watchers remain optimistic about its long-term prospects. Crypto investor Ted Pillows noted that while ETH has underperformed compared to other cryptocurrencies in 2024, it has historically rebounded strongly after periods of underperformance. He suggested that Ethereum could potentially face a final dip to $2,200 before staging a reversal.
Similarly, trader Crypto General expressed confidence in Ethereum’s ability to bounce back from its current levels and potentially retest the $4,000 mark in the coming month. However, he cautioned that a break below a key trendline could see ETH plummet to $2,100.
To regain momentum and signal a potential trend reversal, Ethereum must reclaim the $2,400 resistance level, according to market analysts. Reclaiming this level could pave the way for a bounce towards $2,800 and potentially higher levels. Additionally, reclaiming the $2,850 resistance level, which marked the start of ETH’s upward trend earlier this year, could signal a significant shift in market sentiment.
As of the latest update, Ethereum has experienced a 4.3% surge in its daily price, currently trading at $2,431. This positive price movement comes after a period of significant volatility and uncertainty in the cryptocurrency markets.
In conclusion, while Ethereum faces challenges in the short term, many market observers remain hopeful about its long-term prospects. As the cryptocurrency market continues to evolve, ETH’s performance will be closely monitored by investors and analysts alike.