As a seasoned analyst with over a decade of experience in the financial markets, I have learned to navigate through the turbulent seas of market fluctuations. The recent recovery of Ethereum (ETH) has been an interesting development, especially after witnessing its dramatic plunge on August 5.
After experiencing a substantial dip at the start of the previous week, I’ve noticed that Ethereum (ETH), the second-largest cryptocurrency, has begun to recover modestly. It has regained the crucial $2,600 level, and now aims its focus on surpassing the $3,000 threshold once more.
On August 5th, there was a significant drop in Ethereum’s value, causing it to fall to $2,112 – the largest market decline for the year. Yet, Ethereum has shown signs of recovery lately, increasing by 8% over the past week, suggesting that a prolonged bullish trend might be on the horizon.
Massive Ethereum Liquidations Trigger Bullish Signals
Based on a recent analysis by the crypto market analytics firm CryptoQuant, the graph shows a significant reduction in long-term positions in the futures market for ETH that occurred during last week’s market downturn.
In prolonged periods of rising markets, a substantial selling-off incident like this one is typically preceded by a robust increase in prices, as the future market recovers and the demand for immediate purchasing becomes more prominent.
“A large-scale sell-off has occurred following the latest event, affecting positions that were long on futures contracts to an extent not witnessed since last November. This significant selling off suggests a decrease in market activity, causing numerous highly leveraged positions to be closed out. Such a situation might pave the way for increased participation and enthusiasm in the futures market once again.”
If the futures market undergoes a reset, CryptoQuant speculates that should demand reappear, Ethereum might experience a strong upward trend in the long run, possibly pushing its price beyond its earlier record highs.
ETH’s Price Path To $3,000
Cryptocurrency expert Caleb Franzen shared a comparable forecast about Ethereum’s price on the X platform (previously known as Twitter). He indicated that breaking through the $2,725 barrier might indicate a robust upward trend ahead.
As a researcher, I’ve been observing the Ethereum market and found that Franzen’s analysis of the 4-hour candles shows a pattern of higher lows, which is a bullish sign. Moreover, his supertrend indicators are also leaning optimistically towards Ethereum’s future performance, adding fuel to the growing optimism about this cryptocurrency’s potential.
With Ether (ETH) priced at approximately $2,645 right now, the initial challenge for its upward momentum on the ETH/USDT weekly chart lies at the $2,700 resistance level – a barrier it has yet to surpass in recent trading sessions.
If the ongoing surge in ETH continues for more weeks and the price approaches the point indicated by Franzen, then the $2,900 and $2,990 price levels will be the final hurdles before breaking back through the $3,000 mark.
Instead, if the token manages to move and stay above the $2,550 mark, it can help halt any additional drops, as the upcoming support lies at $2,345 on the daily chart – a level reached after experiencing a 25% decrease.
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2024-08-13 12:04