Journalist
Posted:
- ETH could drop to $2,215 as big sell-off spreads.
- Traders are confident that the altcoin will recover in no time.
According to Whale Alert, a whale sent 14,610 Ethereum [ETH] tokens to the Coinbase exchange on December 30. The transaction was the second within 12 hours after an initial transfer of 9,991 ETH.
At the time of writing, the value of the transaction was $33.50 million. This move is a sign that the altcoin may be at risk of selling pressure.
If the cryptocurrency continues to experience high inflows on the exchanges, the price could drop from $2,220.
Interestingly, the last week of 2023 has seen a turnaround for ETH. On December 28, the value of ETH reached $2,415, as AMBCrypto reported.
This surge gave the Ethereum community a glimmer of hope that ETH price season was close.
No support for the potential
However, recent days indicated that ETH holders may have to wait a little longer for an extended rally. But what do traders think of the price action?
AMBCrypto analyzed ETH’s funding rate through the crypto analysis tool Santiment.
The funding rates show whether long funds pay a funding fee to shorts. It also indicates whether it is the other way around. When the financing rate is positive, most traders are bullish. Moreover, a negative financing interest rate indicates more short positions than long positions.
At the time of writing, ETH’s funding rate was 0.031%. This reading suggested that traders were bullish on the price at the time of writing.
Source: Santiment
Another metric to consider when assessing market perception towards ETH is weighted sentiment. The chart above shows that weighted sentiment has fallen from 2.47 to 0.48.
The rejection suggested the broader market was cautious about betting on Ethereum’s native cryptocurrency.
ETH sees another downturn ahead
Regarding the Open Interest, Coinglass showed that the indicator had risen to $8.40 billion. Open Interest measures market sentiment and the strength behind price developments.
So the increase means that money flowed into contracts related to ETH. However, it could also be a sign of strength for the downtrend that ETH’s price has been experiencing.
Source: Coinglass
From the ETH/USD 4-hour chart, the altcoin had felt the impact of the sell-off as its price fell to $2,290. A look at the Awesome Oscillator (AO) also showed that momentum around the coin was bearish.
At the time of writing, the AO was -10.45.
Should the indicator remain this way, the price of ETH could fall further. Another indicator to take into account was the Fibonacci retracement. At the time of writing, the Fib Retracement level of 0.786 stood at $2,215.
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This position indicated that ETH could fall into the region as long as selling pressure continued.
Source: TradingView
However, $2,215 could be a good entry. This is because ETH has the potential to recover as its price was a previous support level for the altcoin.