Skip to content Skip to sidebar Skip to footer

ETH Investors Beware Of These Mixed Signals

After months of bearish market movements, investors gained hope from ETH’s price movement. The latest correction in its price movements has investors and traders optimistic about the coming months. 

However, this is where we suggest you stop! 

Given that ETH’s perpetual FTX long positions decreased, things appeared less favorable for ETH (Ethereum) in the derivatives market. Additionally, most on-chain data suggested that the trend would soon reverse. 

Nevertheless, some market indicators offered some solace to investors by indicating that the price increase would continue in the days to come.

Continue reading as we gather insights into the market and understand why the latest correction in ETH prices shouldn’t get you excited. 

ETH’s Path To Recovery

The path to recovery for ETH following the ‘Merge’ didn’t follow many people’s assumptions. For many weeks, the top altcoin failed to rise in price, and various other indicators started to work against ETH. 

For instance, according to Coinalyze’s data, Perpetual FTX long positions for ETH have significantly decreased during the past month.

Similar trends were observed on FTX and Kraken, where open interest in permanent futures contracts recently fell to a 22-month low. These changes suggested that the futures market needed to pay more attention to or interest in ETH.

After a protracted wait, interestingly, ETH’s price was surging as it recorded gains of around 25% every week, courtesy of the optimistic crypto market. 

At the time of writing (Nov 1st week), Ethereum had a market cap of more than $191.5 billion and was trading at $1,568. On the other hand, this is where the on-chain data for ETH may have caused investors to cross their fingers because most of them pointed to an impending trend reversal.

There Is A Red Warning Ahead For The ETH Investors

According to data from CryptoQuant, the Relative Strength Index (RSI) for Ethereum was overbought. This warned that the price of ETH could decrease during the next few days. Additionally, the exchange reserves for ETH kept growing, signaling increased selling pressure.

Over the past week, there has been a sharp decline in the growth of the Ethereum network. This was again another bearish sign.

The volume of ETH followed a similar trajectory and dropped over the past few days.

The NFT market for Ethereum also received bad news, as it showed no expansion. The overall number of NFT trades for Ethereum dropped. This suggested that the NFT space of the network had less activity.

Investors Might Finally Have Some Relief?

Even if most of the market indicators were pointing toward a further price increase, Ethereum’s daily chart, in contrast, painted an entirely different picture. 

A bullish crossover was visible on the exponential moving average (EMA). The results of the EMA Ribbon were further supported by the MACD (Moving Average Convergence Divergence) reading, which likewise pointed to the bulls’ market edge.

ETH’s CMF (Chaikin Money Flow) showed an upward trend, which was an optimistic indicator.

The Bollinger Bands (BB) have also shown that the price of ETH was in a position of high volatility, further boosting the likelihood of a price increase in the following days. 

However, ETH’s On Balance Volume (OBV) showed a decline, which would obstruct the cryptocurrency’s upward trajectory.

Role Of The Merge In ETH’s Performance

ETH’s latest 2.0 update also has an equal role in affecting the overall price movement for the token. Following the PoW (Proof of Work) update, there have been many questions concerning the latest developments in the token’s performance. 

However, if the analysts are to be believed, the 2.0 update was the right move to simplify the course of transactions and operations over the ETH ecosystem. So even if the investors and traders cannot seize profit from the latest movements, there might be a possible future where the investors will get added returns for their investment on the token. 

The Future Of ETH Is Uncertain!

Making a wise prediction about the future price of ETH in the upcoming months requires deciphering the possible implications of the Merge on the price of Ethereum. The Surge, The Purge, and the verge are other significant Ethereum ecosystem changes before the Merge, along with The Surge, Splurge, and The Verge.

These improvements are intended to make Ethereum increasingly scalable and energy-efficient. The Ethereum Mainnet and the Proof of Stake Beacon Chain will be combined during the Merge. Several second-order consequences will impact the platform’s usefulness and future expansion as the network switches from PoW to PoS.

In addition to being completely digitalized, ETH serves as the currency for all the Ethereum apps because it is the native coin of the Ethereum Blockchain. As a result, gas (transaction) fees for using the Ethereum network are paid using ETH. 

ETH Towards A Better Future

ETH might soon take on even greater significance when we think about staking. You may contribute to securing Ethereum and receive rewards by staking your ETH.

What else? On Ethereum, you can use Ethereum (ETH) as collateral to generate various crypto tokens. On ETH and other tokens that ETH backs, you can also lend, borrow, and earn interest.

ETH may have a variety of use cases in the future due to its growing programmability.

At the time of writing, the price of ether was $1,568, a drop of about 63% [YTD]. While retaining its market dominance at 19%, ETH displayed accumulation patterns of around $1,500. 

Besides, the $1,060 support area has been upheld by the purchasers, and as a result, it can now serve as a stable rebounding ground and establish a ceiling for more buying pressure. 

Therefore, even though the largest altcoin has not had a great year, investors still have high hopes. 

What’s your next move for the token?

Leave a comment