Ethereum Price Stares At An Extended Slump As Key Metrics Weaken
- Summary:
- Ethereum price faces pressure from multiple fronts amid broader market storm. What are the odds of a recovery in the near term?
Ethereum price has had a forgettable run in the last week, going down by 21 percent. In addition, it is down by a similar figure year-to-date. The decline mirrors that of leading altcoins, which are in the same range. XRP, Cardano, Stellar (XLM) and Sui have declined between 20%-25% in the last week. In comparison, market bellwether, Bitcoin, has only lost 6% of its value during that period.
ETH Price Metrics Signal Extended Control By Sellers
The decline has been accompanied by an underperformance in the DeFi market. According to DeFiLlama data, Ethereum chain’s Total Value Locked (TVL) declined by 13.5% in the last seven days, losing more than $8 billion. That denotes reduced utility for ETH coin, and a continuation of the trend will increase downward pressure on the price.
Technical indicators also add credence to the downward momentum. Ethereum price trades below the 20,50 and 100 Exponential Moving Average (EMA) levels on the daily chart. In addition, the 20-EMA has recently crossed below the 50-EMA, underlining control by the sellers.
However, Ethereum’s long/ratio has improved in the last day, and stood at 2.4 at the time of writing. That means more investors are betting on ETH price to return to the upside in the coming days. Sustaining that momentum could help return the coin to the upside.
Ethereum Price Prediction
The momentum on Ethereum price favours the sellers to be in control. That will likely see the downside prevail if resistance persists at $2,680. The first support will likely be at $2,590. However, a stronger downward momentum will break below that level and potentially test $2,530.
Alternatively, breaking above $2,680 will shift the momentum to the upside. That could see the establishment of the first resistance at $2,725. The downside narrative will be invalid if the ETHUSD pair breaks below that level. Furthermore, an extended control by the buyers could test the second resistance at $2,785.
