Ethereum has witnessed massive rallies since last week, but it might see a price retrace.
Takeaways-
- Ethereum has seen colossal gains since 22 Jul.
- Many indexes now await price correction after the substantial gains.
- According to transaction history, $2,770 can cap Ethereum’s possible plunges.
Market players seem to flock to the ETH marketplace after the eagerly-awaited London upgrade. Though ETH’s prices rose because of the increased demand, some on-chain metrics and tech indicators show incoming profit-taking.
Ethereum’s Sell Signals
Ethereum might see imminent correction regardless of its bullish momentum. The altcoin saw impressive rallies after it broke out of the sinking triangle on 22 July. Since then, ETH, the leading alt by market capitalization, has added its value by almost 60%, standing at $3,200. As Ethereum reaches its forecasted target, red flags start to surface.
The TD sequential indicator depicts a sell flash on Ethereum’s daily price chart. The bearish pattern emerged as a green candlestick, awaiting a downward countdown or 1 to 4 daily candle correction.
Ethereum’s MVRV (Market Value to Realized Value) supports the pessimistic narrative. This metric measures the average loss or profit of addresses bought ETH in a definite period.
The monthly MVRV ratio hovers at 26.58% at the moment. That indicates that addresses that purchased Ethereum in the past one month stand at 26.58% average profit. Santiment, a behavior analytic firm, suggests that a higher MVRV ratio means magnified risks that ETH holder might reduce their activities after selling.
Ethereum might be a dangerous area for now due to the substantial unrealized returns among the holders. Historical forecasts suggest upcoming profit-taking. That would lead to a near-term correction.
ETH Enjoy a Steady Support
According to the IOMAP model, ETH sits on many demand barriers that might prevent sudden downswings.
The initial substantial interest zone ranges from $2,960 to $3,050. Remember, almost 320,000 addresses bought more than 1.4 million Ethereum around this interest area. Another critical support area stands from $2,670 to $2,860. At this point, over 1.12 million crypto addresses purchase 2.63 million Ethereum.
Such a crucial support wall indicates that massive selling pressure might be near-time as bears might struggle to push the price down.
Stay around for what holds Ethereum’s future.
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