Report Shows Ethereum Might Take Another Hit, Is It Possible?
Though volatility is a core attribute of cryptocurrency, the swing is quite excessive for Ethereum. The price movement for Ether was progressive from the beginning of the second of the year. ETH gradually surged over the $1,800 level before the Merge.
To some reasonable extent, the positive sentiment surrounding Ethereum’s transition from PoW to PoS contributed to the surge. As a result, several participants in the crypto industry tilted towards the second largest crypto asset by market cap.
The token recorded a huge increase in its trading volume and other Ethereum derivatives over the period.
However, the launch seems to come with a bearish trend for Ethereum. Just some hours following the Merge, ETH started a southward movement.
The increasing selling pressure depleted the value gradually as the price kept decreasing. Through the past weekend, Ether plummeted below $1,300 as it lost sustainability on some supportive levels.
Is Another Ethereum Correction Underway?
There’s a hint for a more bearish pattern from the Ethereum technical chart. This implies the possibility of another correction of 25% from its current price, which hovers around the $1,350 region. So, ETH might dip further to $1,000.
Based on the last report for the US CPI data for August, there’s an indication of a rise in the inflation rate. However, the response from the crypto assets has been very unfavorable.
The FOMC (the Federal Reverse System’s monetary policymaking body) has scheduled its meeting for Wednesday, 21, 2022. But the entire crypto market is already feeling aggressive selling pressure before the outcome of the FOMC meeting.
The analysis of the Ethereum price charts indicates a drastic drop below the token’s standard deviation. On the higher side, the price of ETH could not cross the hurdle at the $1,800 region.
Also, the downtrend shows that Ether went beyond its critical support of $1,340. Hence, the overall technical implication is that the deviation from support levels has the risk of a downtrend.
This is primarily because Ethereum’s deviation is below the regression channel from the lows as of June. The token is now exposed to the third deviation retreat of $1,250. With that, ETH could hit the next possible support level of $1,000.
ETH Derivatives And Liquidations
According to data from Deribit, the number of Ethereum put, and call contracts has skyrocketed. Its open interest ranges between $1,000 and $2,000, with expiration by the end of September. The range could mark the possible trading value for Ether.
There have been more liquidated positions as the price of Ether increases. As of yesterday, the entire crypto market recorded over $400 million in liquidations. At the time of writing, data from Coinglass shows that Ethereum has over $58 million in liquidated positions within the past 24 hours.