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Key Insights:
- Ethereum price has decent liquidity clusters at around the $3,600-$4,000 level.
- ETH price has been moving sideways for almost 2 weeks, but it has still held above the $4,200 level.
- The altcoin displayed hidden strengths regarding On-Balance Volume (OBV), positive funding, and whale accumulation.
The big-cap cryptocurrencies saw almost no significant price fluctuations over the last two weeks. This happened after Bitcoin (BTC) dropped to the $110,000 zone. Similarly, the Ethereum price fell to the $4,200 zone, but the decline was not as hard as that of BTC.
The technical and on-chain data on different analysis platforms indicated underlying pressure that could affect the Ethereum price. The altcoin has been putting up impressive gains since the turnaround on April 9th from a low of $1,395.
A combination of analysis by renowned analysts showed that the ETH price could dip once more to grab liquidity. It could also shake out weak hands before a Q4 rally.
Why Ethereum Price Could Drop To The $3.6K-$4K Zone
The liquidation heatmap of the cryptocurrency plays a huge role in determining potential areas of interest. There, the price could revisit next. Asset prices often gravitate toward areas with high liquidity. These zones help build momentum for the next significant price move.
From a three-month lookback period, the Ethereum price faced pressure. It faced this from the cluster of liquidity at the $3,600 to $4,000 zone, as highlighted by Ted Pillows.
The interpretation was that the ETH price could slide to sweep liquidity at these levels before resuming its uptrend.
The analysts also noted that the Ethereum price action was weak in writing. The weakness was a reflection of macroeconomic uncertainty and declining demand for ETFs. Ethereum ETFs had outpaced BTC’s mid-August after they saw 20 consecutive days of positive inflows.
What’s Next After The Two-Week Sideways Ethereum Price Movement?
The daily timeframe charts from the same analyst strengthened his take. For the last two weeks, the price of ETH has been moving sideways. This prompts taking longs despite the direction being definite since early April.
Ethereum price could either reclaim $4,500. It could also surge past $4,800 or drop below the $4,200 support level. There, a massive cluster of liquidity rests. ETH’s key levels that could spark a reversal were $4,000 and $3,800.
In the meantime, Ethereum failed to pump even after positive PPI data. This confirmed why traders needed to stay on the sidelines.
Clearing out long and short positions was crucial to going long on ETH. This helped neutralize price manipulation tactics often used by market makers and exchanges.
Ted predicts the Ethereum price could surge to $8K–$10K within the next few months. His outlook is based on ETH price action closely resembling Bitcoin’s 2020–21 cycle. However, in the short term, the price could dip lower.
Hidden Strengths: OBV, Funding Rates, Whale Accumulation
Putting Ethereum price weakness aside, the altcoin displayed hidden strengths regarding On-Balance Volume (OBV), positive funding, and whale accumulation. The OBV went wild after a trendline break with the value above $13 million.
The funding rates for ETH showed that momentum was steady, sidelining bears. This metric indicated that shorts had been trapped, thus suggesting a higher potential for a move.
Interestingly, mega whales with more than 10K ETH bought more as the price hovered around $4,200. A total of 1.15K addresses were involved in the accumulation per CryptoGoos.
Ethereum price structure signaled that it was better for participants to stay sidelined until there was a clear intention to move. As the adage says, “Most money is made by waiting rather than execution.” This prevents overtrading and entering immature setups.
Disclaimer
This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.
