Bitcoin (BTC) recovered from the 16.69K mark to 17K, injecting a lifeline into the industry. The king coin’s gains also boosted altcoins.
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Ethereum (ETH), the altcoin king, is positively correlated to BTC. As such, it witnessed a sharp recovery from $1,182 after BTC pushed to the 17K mark.
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At press time, ETH was trading at $1,253 and nursing a price pullback to a Fib level that could offer buying opportunities.
Source: TradingView
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BTC’s recovery nudged ETH into a price inflection, marking the zero Fib level as a support zone. At press time, ETH was healing off from a post-crash rally. We observed a price pullback on lower timeframe charts. The 12-hour timeframe chart exhibited the same trend.
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The resting zone has been established at the 0.236 Fib level ($1216). The RSI retraced from the oversold territory, showing a reducing sell pressure. Correspondingly, the MFI also retraced from the oversold entrance level, showing accumulation was well underway for buyers. As such, $1,216 presents long trade entry positions with $1305 and $1307 as targets.
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The bullish inclination only holds if bulls can unleash high buying pressure in the coming days or hours to sustain the upward momentum. At press time, the OBV showed a downtick after a recent upside, thus showing uncertainty about incoming volumes that could dictate a strong sell or buy pressure.
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A candlestick close below $1,073 would invalidate the bullish inclination. ETH’s drop beyond this level could extend it further downwards if bears gain leverage; hence, a stop loss below it is feasible.
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ETH active addresses increase after price recovery from $1000
Source: Glassnode
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ETH’s active address increased after the sharp recovery from the $1,182 mark. This shows that more active addresses were involved in ETH trading when its price surged. However, at press time, ETH had dropped slightly to below $1,300, and active addresses were also reduced.
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The drop in active addresses likely indicates the current uncertainty on whether the ETH price will pump. ETH’s negatively weighted sentiment further confirmed this uncertainty, at the time of writing.
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Negative weighted sentiment exposes long-term ETH holders to more losses
Source: Santiment
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According to the on-chain analytics platform, Santiment, ETH’s weighted sentiment, slid into negative territory after enjoying a recent positive elevation. It means the aggregated sentiment around ETH was bearish, and a slight price drop is a testament to this.
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Unfortunately, the negative weighted sentiment is weighing down long-term ETH holders. The 365-day MVRV has been negative for most of the year, translating to losses.
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A bearish sentiment would extend the stay in the negative territory, exposing long-term ETH HODLers to more losses.
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A declining volume could deny bulls enough buying pressure
Source: Santiment
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The fall in volume, as shown by Santiment, could also undermine strong buying pressure to push the altcoin king upwards.
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Therefore, investors need to be patient and check if buying pressure can build in the coming days. Also, tracking BTC movement could give a clear direction on ETH’s next move.
