Ethereum’s short-term support checked, what’s next for ETH now

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Ethereum [ETH] just con­clud­ed its most impor­tant week this year. ETH has unsur­pris­ing­ly deliv­ered a bear­ish per­for­mance after eas­ing off the merge hype.

ETH on 18 Sep­tem­ber was down by rough­ly 20% after a brief stint above $1,700. Its $1431 press time price (on 18 Sep­tem­ber) was the result of post-merge sell pres­sure, as well as the bear­ish over­all mar­ket con­di­tions dur­ing the week.

The pull­back led to a sup­port restest near the $1430 price lev­el where the price hov­ered at press time.

Source: Trad­ingView

The price has already demon­strat­ed some resis­tance along the same sup­port lev­el in the last three days. But can it sum up enough bull­ish pres­sure to not only bal­ance out the sell­ing pres­sure but also trig­ger a bull­ish pivot?

Some of ETH’s met­rics indi­cate an increased pos­si­bil­i­ty that ETH might be head­ed for a bull­ish rever­sal this week. For exam­ple, demand in the deriv­a­tives mar­ket is recov­er­ing. ETH’s options and futures open inter­est met­rics have piv­ot­ed, con­firm­ing a return of demand.

Source: Glassnode

A sim­i­lar piv­ot occurred the last time that ETH retest­ed the cur­rent sup­port lev­el towards the end of August. This obser­va­tion will like­ly con­tribute to improved sen­ti­ment in the spot mar­ket, an out­come that would fur­ther strength­en the bull­ish outlook.

The sup­port retest also trig­gered an increase in the num­ber of active deposits. As a con­se­quence, the trans­ac­tion vol­ume has also increased in the last three days.

Source: San­ti­ment

The increased ETH activ­i­ty at the cur­rent price lev­el some­what indi­cat­ed a return of investors’ con­fi­dence after last week’s sell-off. This might be a sign that investors antic­i­pate a recov­ery in the next few days.

Conclusion

The obser­va­tions on ETH’s on-chain met­rics indi­cate that demand is grad­u­al­ly return­ing to nor­mal. We will like­ly see an increase in the amount of buy pres­sure as more buy pres­sure floods back into the mar­ket. Enough demand can trig­ger a siz­able rally.

Investors should take note of the volatile nature of the mar­ket and its sus­cep­ti­bil­i­ty to change. This means the risk of anoth­er major sell-off is still live, espe­cial­ly in case of unfa­vor­able mar­ket infor­ma­tion in the next few days.

That being said, it’s impor­tant to note that on 19 Sep­tem­ber, the king alt was chang­ing hands at $1,293 with an 11.07% decrease in val­ue over the last day.

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