The world’s second-largest cryptocurrency ETH witnessed a greater fall over the last weekend following the Fed Jackson Hole meeting. As of press time, ETH is trading 7% down on the daily chart at a price of $1,451 with a market cap of $177 billion.
The recent ETH price correction has sent the cryptocurrency trading under two major supply zones. Citing data from IntoTheBlock, popular trader Ali Martinez explains:
Ethereum trades below two significant supply zones. One at $1,475, where 585K addresses bought 2.81 million $ETH, and another at $1,560, where 526K addresses hold 3.44 million #ETH. The only considerable support level is $1,335, where 412K addresses purchased 2.2 million #ETH.
He further explains that the Ethereum network growth has been the lowest in over two years. This could mean a strong “bearish” momentum going ahead. Ali Martinez said:
Ethereum network growth hasn’t been this low in more than two years. The last time the # of daily new $ETH addresses was 49,700 was back in March 2020. A steady decline in the # of new addresses created on the #ETH blockchain tends to lead to a steep price correction over time.
ETH Corrects Just Before Merge Upgrade
During the entire July and half of August, ETH made a strong pullback gaining over 90% from the bottom of $1,000 in June end. However, ETH has seen a strong 25% retracement from the peak and is currently trading under $1,450 levels.
This shows that the global macro factors have overshadowed the optimism surrounding Ethereum Merge. In a note last Friday, analysts at Bitfinex said:
“Ethereum’s drop ahead of the impending Merge is also of note as bearish sentiment appears to be taking hold across all so-called risk assets. The volatility that has become so characteristic of the digital token space shows no signs of abating.”
All eyes will be on the $1,335 level which has the last major supply zone. Falling under it could mean even greater correction.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.