Ethereum (ETH) has seen a minor uptick of 2.80% over the past week, yet the leading altcoin remains entrenched in a bearish downtrend that has persisted since December. In light of this market climate, esteemed market analyst Ali Martinez has pinpointed crucial price levels that will determine whether ETH’s correction has reached its conclusion, and if now is the time for market entry.
Ethereum: A Buying Opportunity Or More Downside Ahead?
In a detailed analysis post on X, Martinez observes that Ethereum has plummeted by 57% from its local peak of $4,100 reached in December. This significant decline is largely attributed to a widespread distribution of assets by major Ethereum holders, commonly referred to as ‘whales’. Over the last four months, wallets containing 10,000 ETH have decreased by an alarming 80%. Additionally, large holders, specifically those with 100,000 ETH or more, have divested a staggering 130,000 ETH during this time.
Contributing to Ethereum’s downturn has been the sharp withdrawal of funds from Ethereum Spot ETFs, culminating in a net outflow of $760 million within the last month alone. This has led to increased selling pressure, with reports indicating that 100,000 ETH was transferred to investors poised to sell, driven by impending fears of further price losses.
Looking ahead, Martinez identifies a series of technical indicators suggesting that further declines for Ethereum could be imminent amidst this selling frenzy. For instance, a breakdown from an ascending triangle pattern on the 3-day charts implies that ETH may potentially reach a price target near $1,000.
Moreover, ETH pricing bands have indicated that $1,440 serves as another pertinent downside target, signaling a possible 27.4% decline from current market prices. Significantly, the Cost Basis Distribution data supports these bearish forecasts, suggesting that Ethereum remains above a crucial support threshold set at $1,887. Should ETH dip below this level, additional declines to targets such as $1,440, $1,250, and $1,000 could become plausible.
Notably, however, Martinez does see potential for a market recovery for Ethereum. By examining the cumulative ETH purchases at various price points, he suggests that bullish investors are encountering formidable resistance in the $2,250 to $2,610 range. Should ETH bulls manage to breach this resistance, it would invalidate the current bearish outlook and provide a more favorable market scenario.
Ethereum Price Overview
As of the latest updates, Ethereum is trading at $1,985, demonstrating gains of 1.10% in the past day and 2.10% over the last week. Nevertheless, the altcoin has experienced a significant downturn of 27.32% within the past month. Presently, Ethereum stands as the largest altcoin in the market, boasting a market capitalization of $239 billion, which constitutes 8.7% of the total cryptocurrency market.
