After hitting their most recent highs of almost $42,000 and $2,300, respectively, Bitcoin and Ethereum have seen a decline during the last several hours. On-chain data analysis suggests that short-term investors are using this opportunity to sell their holdings and profitably exit the market. Stronger support levels, however, imply that Ethereum’s price is ready for a bounce and is probably going to continue rising.
Bulls Liquidated $3.5 Million Worth Of Positions
The price of ETH encountered resistance just under $2,300, which sparked a wave of sell-offs by investors looking to lock in their gains from the recent surge. Data from Coinglass indicates that once the price lost its upward impetus, short-term traders sold down more over $3.5 million in long holdings. As a result, the price of ETH fell slightly below the initial Fibonacci retracement levels.
The well-known on-chain analytics business Santiment recently released a statement in which it was mentioned that Ethereum’s market value had increased to $2,250 for the first time in more than a year and a half. The Ethereum market is seeing a rise in long positions and open interest as a result of this noteworthy milestone.
Santiment emphasized that this pattern reflects an increasing sense of FOMO among traders. On-chain data warned that the market is more vulnerable to a downturn even while there is still room for price increases. The main cause of this is traders taking on more leveraged positions out of greed, which may increase market volatility and maybe cause corrections.
Even if there has been a recent decline, it seems to be a brief setback because the price of ETH has strongly refused to go lower and has recovered swiftly. Now trading at 1.2012, the long-short ratio has risen beyond 1, meaning that 55% of holders are now expecting a price increase. Conversely, bears are posing a significant obstacle, with 45% of traders holding short positions.
What’s Next For Ethereum Price?
After sellers were unable to drive the price of ether below $2,200, it recently saw a robust recovery from its 23.6% Fib channel, indicating that purchasers are actively defending this price range. It is difficult for purchasers to raise the price above $2.3K, though. The price of ETH is currently trading at $2,217, up more than 3% from yesterday’s pricing.
Going forward, the bulls will try to push the price in the direction of the large overhead resistance at $2,464, which is an important level to keep an eye on in the near term. An ascending triangle pattern, a bullish indication, might be completed with a successful break through this barrier. A target price of about $2,800 could be set upon the completion of this pattern.
Conversely, the 20-day EMA acts as a crucial degree of support. A price decline below here will indicate that the bullish momentum is waning. Such a pause might cause a drop in the direction of the critical $2,000 level.
