Ethereum (ETH), the cryptocurrency with the second largest market capitalization, appeared to be indicating a possible decrease in price following the formation of a bearish pattern on the charts at the current time.
Evaluating the Bearish Scenario for Ethereum (ETH)
It is worth noting that this bearish trend is not limited to ETH alone, but is also visible in other major cryptocurrencies like Bitcoin (BTC), XRP, and Solana (SOL).
ETH has been on a downward trend since December 2024 and has broken below, subsequently retesting its support level, reinforcing the bearish sentiment.
Forecasting the Price of ETH
Considering its recent price movements and historical performance, if this sentiment persists, there is a strong likelihood that ETH could experience a 10% decline, reaching the $2,850 mark in the foreseeable future. Nevertheless, technical indicators suggest the potential for a price recovery.
For example, on a daily basis, ETH’s Relative Strength Index (RSI) is approaching oversold levels, indicating a possible reversal. Simultaneously, the 200 Exponential Moving Average (EMA) suggests that the asset is on an upward trajectory.
Trader Sentiment Favors a Bearish Stance
Despite the positive signals from these indicators, traders are cautious about entering long positions, as per insights from the on-chain analytics company CoinGlass. Presently, ETH’s long/short ratio is at 0.94, showcasing strong pessimism among traders.
Analysis indicates that 52.67% of leading traders are holding short positions, while 47.33% have opted for long positions.
Nevertheless, trader positions have been significantly increasing during this bearish phase, with a notable 4.5% rise in ETH’s Open Interest within the last 24 hours. These metrics imply that short-term traders are bearish, potentially resulting in a forthcoming price decline.
Recent Behavior of Whales in the Market
Alongside traders, long-term investors and significant holders are also seen accumulating ETH, as per CoinGlass’s spot inflow/outflow data.
Recent information reveals that exchanges have witnessed outflows totaling more than $21 million in ETH over the past day, indicating a potential accumulation phase that might generate buying pressure and present a buying opportunity.