Emily Walker
The overall cryptocurrency market has seen a significant decline, and Ethereum is also reflecting this downtrend, slipping below important support levels. Diminishing market performance is affecting investor confidence in ETH, suggesting that the altcoin may face a more extended decline in the days ahead.
Factors Pressuring Ethereum’s Value
Recent trends indicate that Ethereum might be entering a correction phase as increased selling pressure impacts its value. A report from the analysis platform IC News suggests that the behavior of investors and pricing on a daily basis points toward a potential downturn.
This report highlights a slowdown in bullish momentum, with investors leaning towards profit-taking to reduce losses. If selling continues to rise, ETH could see further drops, reaching critical support levels.
IC News noted that heavy selling occurred when ETH hit the $3,500 mark, signaling weak purchasing demand. They characterize this situation as a false breakout, which potentially opens the door for a rejection soon.
If the altcoin can break through vital price levels and reclaim the $3,500 spot, IC News believes it could initiate a bullish trend. Conversely, a failure may lead to increased volatility and further price declines.
As the ETH price moves up and down, investors are carefully observing the situation to see if the asset can regain its upward trajectory or if a larger market correction is imminent.
Nonetheless, certain indicators on ETH’s chart suggest the possibility of a return to upward momentum towards significant resistance levels nearing its all-time high. A technical analyst, Titan of Crypto, foresees a substantial rally for Ethereum as it approaches a critical breakout.
This expert pointed out a Falling Wedge formation on the daily chart, predicting that a breakout would reignite momentum and propel Ethereum higher. “As expected, bullish divergence has emerged, and ETH’s falling wedge is now fully developed,” he remarked.
According to Titan of Crypto, if a breakout occurs, the altcoin could rise as high as $4,500 within the next few weeks. Such a rally may draw interest from both new and existing investors, potentially leading to an uptrend toward a fresh all-time high.
ETH’s Weakness Tied to Declining Whale Transactions
While major altcoins are faring well this cycle, ETH has struggled to spark a significant price increase. Its lackluster performance can be attributed to a decrease in large transaction volumes compared to prior bull markets.
Historically, increases in large transaction volumes have preceded notable price increases, as observed during the cycles of 2017 and 2021. Currently, Ethereum only experiences minor upticks in whale activity, which do not signal a potential explosive price movement. For ETH to rebound strongly towards key resistance levels, there must be an uptick in large transaction activity.