TLDR
- After bouncing back from a dip to $3,021, Ethereum's price encountered a barrier at $3,220.
- In 2024, Ethereum's exchange reserves have dwindled to levels not seen in years, hinting at a possible shortage in supply.
- The technical outlook tells a tale of mixed trends, showing that while there is room for a rise, Ethereum's performance isn't quite matching up to Bitcoin's.
- The current trading price is beneath the 100-hour Simple Moving Average, with significant resistance looming at $3,250.
- The ETH/BTC trading pair exhibits signs of weakness, with upcoming support falling within the 0.028-0.026 range.
Even as Ethereum battles technical hurdles around $3,220, it's managing to remain above the $3,100 line. Recent updates indicate a significant dip in exchange reserves, reaching unprecedented lows in early 2024, indicating a potential squeeze in supply.
Known as the second-largest digital currency by market cap. recently experienced a price dip below $3,150, A minor drop to $3,021 saw bullish traders stepping in promptly, propelling the price back over $3,120.
Exchange reserves for Ethereum has seen major transformations since the bull market crest of 2017-2018. This metric surged again during the 2020-2021 period, being propelled predominantly by the rising DeFi landscape and increasing projects built on Ethereum.
Beginning in late 2021, exchange reserves saw a steep decline as large withdrawals took place. This trend persists into 2024 with reserves staying at very low historical levels. Analysts point out this might reflect a change in how holders manage their assets, with a shift towards long-term safekeeping.
A glance at the technical charts uncovers a complex market dynamic. with Ethereum Currently, trading happens under both $3,200 and the 100-hour Simple Moving Average with a bearish trend line resisting $3,250 on the hourly graph.
Immediate resistance is noticed around $3,150, with a more formidable barrier near $3,220, aligning with the trend line along the 50% Fibonacci retracement level from the earlier decline between $3,425 and $3,021.
According to trading insights, Ethereum has to break past the $3,270 resistance mark to initiate a stronger upward trajectory. Succeeding this level could pave the way to $3,350, potentially moving towards $3,420 or even reaching $3,500.
On the downside, $3,050 stands as the first support, with a crucial level pinpointed at $3,020, a breakdown of which might trigger heavier selling pressure, nudging the price to $3,000 or perhaps $2,950.
The relationship between Ethereum Some concerning patterns have been noted in Bitcoin's performance. Bitcoin generally shows a steady rise, whereas the ETH/BTC pair reveals a trend of lower lows, indicative of weakened comparative strength against Bitcoin.
Market expert Anup Dhungana pinpoints the next technical support range for the ETH/BTC pair to be between 0.028 and 0.026. A rebound from these areas could spark renewed interest in Ethereum and the broader altcoin space.
Despite facing conflicting indicators, some market experts keep a positive perspective. Crypto Ceaser, a respected market analyst, recently spotlighted Ethereum's price rebound as a significant opportunity, citing that the asset is undervalued at its current standing.
$ETH – #Ethereum The bounce occurred as projected. This represented a tremendous opportunity. Take action.
From my viewpoint, Ethereum is significantly undervalued, and I anticipate reaching new all-time highs soon. pic.twitter.com/ljMa1lEpJO
— Crypto Caesar (@CryptoCaesarTA) January 28, 2025
Historically, a drop in exchange reserves has often aligned with price stability at higher ranges. This pattern prominently appeared from 2022 onwards, where dwindling reserves matched up with robust price support.
The hourly MACD indicator shows momentum in a bearish domain, while the RSI is below the 50 mark, which means short-term technical softness.
Recent price fluctuations have culminated in a slight 2.3% rise over the past day, yet Ethereum displays a 3.3% fall in the weekly view.
Continued withdrawal trends from exchanges pose a likelihood of a supply shortage, typically contributing to upward price pressure if demand rises.
The latest market data points to significant resistance forming at $3,270 and support deems established around $3,020.
