Ethereum Price Update: ETH Dips Below $3K – How Low Could it Drop?

Ethereum has been undergoing a period of consolidation in its price for several months now, unable to surpass the $4,000 resistance level.

When examining the daily chart, it is evident that the price recently bounced back from $2,800 and made a push towards the $3,500 resistance level. However, it was rejected, leading to a decline below the 200-day moving average situated around $3,200. Currently, Ethereum is trading under the $3,000 support level, indicating a potential further decrease in the near future.

On the 4-hour chart, the rejection from the $3,500 resistance level could be part of a larger bullish trend. Despite correcting nearly 70% of its recent rally and being within the Fibonacci retracement golden zone, the Relative Strength Index (RSI) remains below 50%, suggesting a continued bearish momentum. Investors are advised to exercise caution due to the complex market conditions.

Delving into on-chain analysis, the Exchange Reserve metric for Ethereum, which measures the quantity of ETH stored in exchange wallets, provides valuable insights into market dynamics. The metric has shown a significant decline over recent months but has seen a recent uptick, indicating increased coin deposits on exchanges. This behavior, driven by fear, results in surplus supply that could potentially drive prices down further.

By analyzing the fundamentals of the Ethereum network, investors can gain a better understanding of market trends and participant behavior. Keeping a close eye on such metrics and market indicators can help navigate the volatile crypto landscape effectively.

In conclusion, Ethereum’s price movements are being closely monitored by traders and investors as it navigates key resistance levels and market dynamics. With technical and on-chain analysis pointing towards potential bearish pressures, market participants are advised to remain vigilant and informed to make well-informed decisions in this evolving crypto market landscape.