Ethereum (ETH) continues to face intense selling pressure, dashing hopes of a swift recovery to the $3,000 mark. Over the past two weeks, a staggering 255,869 ETH—worth more than $596 million—has been moved to exchanges, signaling investors’ readiness to liquidate their holdings. This wave of sell-offs echoes a similar trend from March, where profit-taking by holders created substantial downward pressure on the cryptocurrency.
Holders On Alert As ETH Faces Market Headwinds
The surge in ETH being transferred to exchanges is a clear indicator of waning confidence among holders. With market sentiment still leaning bearish, Ethereum’s path to recovery is increasingly challenging. Investors appear cautious, unwilling to hold onto ETH in the current uncertain environment, as profit-taking remains a dominant theme.
This bearish sentiment has left ETH struggling to maintain upward momentum. While previous rallies showed promise, they were quickly tempered by aggressive sell-offs, limiting the cryptocurrency’s ability to break through key resistance levels.
Weakening Bitcoin Correlation Adds to Volatility
One of the key drivers of Ethereum’s price is its historical correlation with Bitcoin (BTC). When ETH and BTC move in sync, it often signals broader market confidence in both assets. However, Ethereum’s correlation with Bitcoin has recently dropped to 0.54, raising concerns about heightened volatility.
As this correlation weakens, ETH becomes more vulnerable to price fluctuations that may not be as closely tied to Bitcoin’s performance. This could lead to increased downward pressure, especially in a market where confidence is already shaky. The reduced correlation adds another layer of uncertainty to Ethereum’s price action, leaving many investors on edge.
Bearish Outlook for Ethereum – $3,000 a Distant Goal
Ethereum is currently trading at $2,334, hovering just below a key resistance level of $2,344. Given the ongoing sell-off and broader market weakness, the prospect of ETH hitting $3,000 appears slim in the short term. If selling pressure continues, Ethereum could slip further, potentially testing support at $2,170.
While a fall below this level is not the most likely scenario, it remains a risk, particularly if broader market conditions worsen. On the other hand, if the market sees a sudden shift in sentiment and turns bullish, Ethereum could regain some momentum. A climb back to $2,681 would be the first positive signal, potentially invalidating the bearish outlook and opening the door to a rise toward $3,000.
For now, Ethereum’s price remains under pressure, with the $3,000 target looking increasingly elusive. Holders are bracing for further declines as the bearish sentiment lingers, and the weakening correlation with Bitcoin adds another element of risk. A sustained recovery will depend on a significant shift in market sentiment, but for now, caution is the prevailing mood.
As Ethereum’s price action unfolds, all eyes are on the next major moves, which will likely determine whether the cryptocurrency can stage a comeback or continue its downward slide.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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