Ethereum Price Analysis Indicates a Potential Support at the $2,500 Mark
Ethereum (ETH) witnessed a prominent surge of 60% in May, culminating at a high of $2,617 before settling around $2,509, exhibiting signs of cooling momentum. This prices rise resulted in two substantial spikes in trading activity, primarily from long-term holders selling their ETH positions, as seen for the first time since October.
In the past month, approximately $3.42 billion worth of ETH was accumulated, signifying investor confidence. Despite this, long-term holders began offloading their holdings as the price continued to escalate.
Technical analysis indicates that Ethereum found support at the $2,500 level before resuming its rise. The token managed to surpass the resistance levels of $2,550 and $2,620 during its recovery. As of now, Ethereum is trading at $2,675, above the 100-hour Simple Moving Average, and a bullish trend line with support at $2,550 has formed on the hourly chart.
Analysis of data by the Age Consumed metric from Santiment reveals two of the most significant spikes in long-term holder activity since October. This indicates that seasoned investors are selling positions they have held for longer durations. The magnitude of these movements represents the largest activity in seven months, which could potentially impact Ethereum's ability to maintain its momentum.
Approximately 1.34 million ETH were withdrawn from centralized exchanges during the past month, equating to over $3.42 billion worth of the cryptocurrency leaving trading platforms. This decrease in available supply on exchanges usually indicates a shift towards long-term holding, and not active trading.
While the Relative Strength Index (RSI) is currently at 67, slightly under the overbought threshold of 70, the MACD indicator shows strengthening bullish momentum. Volume has thinned out near the current price levels, showing reduced trading activity.
The recent price action has created resistance levels at $2,740 and $2,750, with significant resistance at $2,800. Clearing the $2,800 resistance zone could set the price towards $2,840 and eventually $2,920. On the downside, support levels are found at $2,675 initially, followed by major support at $2,550 and the trend line. This level aligns with the 61.8% Fibonacci retracement of the recent upward move.
In summary, Ethereum's price rally faces pressure due to the selling activity of long-term holders. Despite this, the token continues to show resilience and has not deviated significantly from its current position. The overall outlook remains positive, provided broad market trends remain favorable.
- The surge in Ethereum's price and the subsequent resistance at $2,740 and $2,750 could potentially be influenced by the significant selling activity of long-term holders, as seen in data analyzed by the Age Consumed metric from Santiment, marking the most substantial spikes since October.
- The ongoing price rally of Ethereum, despite the selling activities of long-term holders, is supported by the technical analysis, with the token trading above the 100-hour Simple Moving Average and the formation of a bullish trend line with support at $2,550 on the hourly chart. Moreover, the MACD indicator shows strengthening bullish momentum, offering a positive outlook for the cryptocurrency's price, provided broader market trends remain favorable.
