Ethereum Price Faces Selling Pressure as Bulls Defend Support
The price of Ethereum (ETH) is currently experiencing significant selling pressure, but bulls are working quickly to defend the support level at $1,550. Last week, the approval of several Ether futures ETFs caused a surge in ETH’s price to $1,750. However, due to a weak crypto market structure and profit-taking among investors, the recovery was short-lived, resulting in a sharp decline. Over the past 24 hours, ETH has remained relatively unchanged, but it has dropped by 4.6% over the course of a week and is currently trading at $1,557. During this period, approximately $7.5 billion in trading volume has been recorded, while Ether’s market capitalization remains at $187 billion.
Ethereum Cedes Ground to Bitcoin Amid Geopolitical Tensions
Investors seeking exposure to the most popular digital asset amid ongoing geopolitical tensions have caused Ethereum to lose ground to Bitcoin. Since June, Ethereum’s market value has shrunk by 18%, while Bitcoin has experienced a similar decrease to $522 billion. In the past seven days, Ethereum’s market value dropped by 4.6%, compared to Bitcoin’s 2.9% decline to $26,792. As a result, Ethereum’s percentage of the total market capitalization has decreased from 18.4% to 17.9% since the beginning of the year. On the other hand, Bitcoin’s market value has risen from 40% to 50%. Additionally, the Ethereum network has faced setbacks recently with declining network activity and gas fees.
Ethereum Underperforms Due to Bear Market Impact
Ethereum’s underperformance compared to Bitcoin can be attributed to the ongoing impact of the bear market. Traders historically turn to Bitcoin during bear markets, leading to Ether’s decline in price and volume ratio over the past year. While Ethereum has seen a 32% increase this year, it is significantly less than Bitcoin’s 66% growth. The war in the Middle East has also influenced investor preferences, with many choosing Bitcoin over Ethereum.
Ethereum Price on the Verge of Further Decline
Currently, Ethereum’s price is below all bull market moving average indicators, including the 21-week Exponential Moving Average (EMA), the 100-week EMA, and the 200-week EMA. The Relative Strength Index (RSI) further confirms the bearish outlook as it drops below the midline and heads towards the oversold region. If support at $1,550 is lost, it would mean abandoning a potential trend reversal indicated by a falling wedge pattern on the weekly chart. The next support levels are at $1,450, but extended losses to $1,230 and $1,050 cannot be ruled out. However, if bulls hold their ground at $1,550 and push for higher support at $1,600, an immediate recovery could occur with targets set at $1,800 and above $2,000.
Hot Take: Ethereum Struggles Amidst Bear Market Impact and Geopolitical Tensions
Ethereum is currently facing challenges as it deals with selling pressure and underperforms compared to Bitcoin. The weak crypto market structure and profit-taking among investors have contributed to its decline in price. Additionally, ongoing geopolitical tensions have led investors to prefer Bitcoin over Ethereum. The war in the Middle East has influenced this preference as well. Furthermore, Ethereum’s market value has decreased while Bitcoin’s has increased since June. The Ethereum network has also experienced setbacks recently with declining network activity and gas fees. However, there is still potential for a trend reversal if support levels are maintained and higher support is reclaimed.
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