Over the last day, Ethereum, the front-runner among altcoins, has bucked the broader market trend and seen a decrease of about 2% in its value. This drop occurs as interest and demand for the coin continues to dwindle.
As buying pressure wanes, ETH risks falling below $3000 soon. This analysis has the details.
Ethereum’s Demand Loses Steam
Examining ETH’s momentum factors on a daily ETH/USD graph suggests a decrease in demand for the altcoin. For instance, its Relative Strength Index (RSI) is on a decline and currently sits below the 50 neutral threshold at 42.61.
As a financial analyst, I utilize the Relative Strength Index (RSI) to assess the market conditions of an asset. This index spans from 0 to 100, with figures exceeding 70 pointing towards the asset being overbought, indicating potential for correction. Conversely, values below 30 hint that the asset might be oversold, suggesting possible rebound or recovery.
The technical analysis setup with Ethereum’s Relative Strength Index indicates a decrease in its momentum, which could mean less demand for the asset, possibly causing a drop in its value if this trend continues.
Additionally, at present, the Chaikin Money Flow (CMF) of the coin is showing signs of dropping below the zero line, which implies a decrease in the demand for Ethereum.
The Capital Movement Function (CMF) tracks the net inflow or outflow of funds in an asset within a particular timeframe. When the CMF approaches the zero line from below, it suggests that selling activity is intensifying, potentially signaling a shift towards bearish trends and a possible drop in price.
ETH Price Prediction: Drop to $2,811 or Rally to $3,476?
Currently, Ethereum (ETH) is being traded at around $3,175, slightly under the resistance level set at $3,249. Given the decreasing buying interest, there’s a possibility that the ETH price might dip below $3,000 in the short term, potentially reaching approximately $2,811.
However, if market sentiments improve, it could push ETH’s price above $3,249 toward $3,476.
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2025-01-19 21:43