Why did the price of Ethereum fall?
Will it break its lowest level in 16 months?
Ethereum (ETH)
- the second largest cryptocurrency by market capitalization
- has seen a noticeable drop in price over recent days
- falling to the $2,000 level, its lowest level in 16 months.
This decline raised questions about the reasons behind this decline.
Possible reasons behind
the decline in the price of Ethereum:
Macroeconomic pressures and trade tensions :
- Global trade tensions, especially after the United States imposed tariffs on
- countries such as Canada, Mexico and China, have increased
- uncertainty in financial markets.
This situation prompted investors to avoid high-risk assets, which negatively
affected cryptocurrencies including Ethereum.
Increased :
supply and growing selling pressure:
- Over the past 30 days, the traded supply of Ethereum has increased
- by approximately $66,350, equivalent to more than
- $138 million at current market prices.
This increase in supply has increased selling pressure on the currency
especially with the transfer of large amounts of Ethereum to trading platforms
indicating readiness for selling.
Massive liquidation and whale activity:
Leveraged markets have seen significant liquidations of long positions in
the past 24 hours, with the total liquidation reaching approximately $861 million
including $168 million for Ethereum purchases.
This activity by holders of large amounts of Ethereum
known as “whales”, has increased selling pressure on the coin.
Technical :
breakdowns and bearish indicators:
Many analysts have pointed to bearish patterns in Ethereum charts
indicating a possible continuation of the decline to levels that could reach $1,540
or even $1,000 if the downward momentum continues.
These analyzes are based on technical patterns such as “double top”
and previous support levels.
Despite the current challenges, some analysts believe that the current
price levels may represent a buying opportunity for long-term investors.
Historically :
periods of significant declines have been preceded by notable price rebounds
as large investors tend to accumulate during periods of heavy selling.
However :
investors should exercise caution and closely monitor economic
and technical developments before making investment decisions.
In conclusion :
the recent decline in the price of Ethereum reflects the influence of a range of
economic and technical factors, and it is always important for investors to stay up
to date with developments and take into account potential
risks when dealing with digital currencies.