Ethereum $1,778 has increased by 5.70% in the last three days, reaching $2,444. However, the short-term outlook remains uncertain. On-chain metrics signal potential selling, indicating a possible decline in Ethereum’s price that could surprise investors.
Evaluating the Possibilities of Ethereum’s Price Decline
With Bitcoin’s recent rise, a significant recovery has been observed in the cryptocurrency market. Ethereum has followed suit, increasing by approximately 6% to $2,444. Although the demand zone between $2,252 and $2,440 is seen as a critical reversal area, the overall outlook continues to be uncertain.
Signals for Ethereum Investors to Watch
There are four key signals suggesting an imminent decline in Ethereum’s price. Firstly, uncertain macroeconomic policies and geopolitical tensions, such as the Iran-Israel conflict, may impact ETH. Secondly, the 365-day MVRV ratio hovering around -14% indicates that there has yet to be capitulation, suggesting further declines may occur.
Lack of New Capital Inflows
A decreasing trend in whale transactions suggests institutions are not interested in purchasing ETH at current price levels. Additionally, the increase in the amount of ETH held on exchanges is considered a negative sign and may indicate potential declines if the situation worsens. The absence of new capital inflow in network growth indicators shows that investors do not find current prices attractive.
Despite the short-term rise in Bitcoin $93,993 and the overall cryptocurrency market, caution is warranted in Ethereum price forecasts. An escalation in the Iran-Israel conflict could significantly impact both stock and crypto markets. Historically, news of warfare has negatively affected stock markets, making a decline in Ethereum’s price likely.
It is crucial for Ethereum investors to closely monitor market developments and pay attention to the signals mentioned above. These indicators provide valuable insights for precautions before a potential price decline.
Considering the factors mentioned, it is advised to exercise caution in the Ethereum market and prioritize risk management. Investors should keep these signals in mind to understand market dynamics and be prepared for potential risks.