Ethereum Dencun - File photo

Ethereum Faces Struggles as Investor Sentiment Shifts: Can ETH Reclaim $3,530 or Fall Further?

Ethereum’s price volatility continues to test investor sentiment, with the cryptocurrency repeatedly falling below the $3,000 mark. This inability to sustain upward momentum has led to growing skepticism among holders, triggering a wave of profit-taking.

Investors Unload Over $1.3 Billion in Ethereum

Recent market activity highlights a significant shift in investor behavior. Over 410,000 ETH, worth more than $1.3 billion, has been sold within a week. This surge in sell-offs is reflected in the increased Ethereum supply on exchanges, signaling that traders are prioritizing short-term gains over long-term holding.

The lack of a clear recovery path has amplified uncertainty, further driving profit-taking behavior. Ethereum’s failure to breach critical resistance levels underscores a cautious sentiment, with many market participants opting to reduce exposure.

Ethereum Supply On Exchanges
Ethereum Supply On Exchanges. Source: Santiment

Mixed Signals: NVT Metric Suggests Undervaluation

Despite the bearish price action, Ethereum’s Network Value to Transaction (NVT) ratio has reached a 25-month low, signaling potential undervaluation. Historically, such readings have preceded rallies, offering a glimmer of hope for bullish investors.

This undervalued status may help Ethereum avoid sharp corrections, attracting renewed interest from buyers looking for opportunities. However, this potential remains contingent on broader market conditions and sustained buying pressure.

Price Outlook: Key Levels to Watch

 Ethereum NVT Signal
Ethereum NVT Signal. Source: Glassnode

Ethereum currently holds above $3,303, following a failed attempt to break the $3,530 resistance level. Last week’s dip to $3,131 highlights ongoing challenges in maintaining bullish momentum.

Ethereum Price Analysis
Ethereum Price Analysis. Source: TradingView

If Ethereum successfully breaches $3,530, it could trigger a rally toward $3,711, restoring investor confidence. However, failure to reclaim this critical barrier risks further declines, with the $3,131 support level likely to be tested again.

Also Read: Solana’s $120B DEX Volume Surge: Is Ethereum’s Reign as Top Layer 1 at Risk?

For now, Ethereum’s path forward hinges on overcoming resistance and rekindling optimism. Sustained demand and favorable market dynamics will be crucial in defining the cryptocurrency’s next move.

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.

About The Author

Previous post Trump Memecoin Plunges 60%: Can It Bounce Back or Is the Hype Over?
Kraken Bitcoin Next post Kraken Loses ‘Major Questions’ Defense in SEC Lawsuit but Keeps Key Legal Arguments Alive