- Ethereum has undergone a strong rally over the past few weeks, moving higher with Bitcoin.
- But key market data suggests that the case for upside will be limited for the time being.
- For one, there are “monstrous sell walls” on Coinbase for the Ethereum chart.
- These walls should limit upside for the time being.
Ethereum Market Data Suggests Price Could Drop
Ethereum has undergone a strong rally over the past few weeks, moving higher with Bitcoin.
But key market data suggests that the case for upside will be limited for the time being.
He shared the chart below just recently, which shows that there are “monstrous sell walls” on Coinbase for the Ethereum chart. These sell walls should limit upside for the time being. The sell walls are situated in the $480 region, where ETH found resistance during the summer.
Chart of ETH’s price action over the past few days with order book from CL (@CL207 on Twitter)
The same trader shared this chart below slightly earlier. The chart shows Ethereum’s December futures contract on Huobi. As can be seen, there is quite a large imbalance of ask orders to buy orders. That’s to say, there is currently more selling pressure on the books than buying pressure, which may result in downward price action in the weeks ahead.
“kinda agree, Im hedging some of my DeFi exposure iva ETH, huobi whales have thick asks on quarterlies too so upside on ETH should be limited.”
Long-Term Trend Still Positive
While there are signs that Ethereum could drop in the near term, the long-term trend still seems intact for further upside.
A crypto-asset analyst recently shared the chart seen below, which compares BTC’s price action to ETH’s price action over the past two and a half years. As can be seen, the charts are largely correlated until recently, with BTC pulling away dramatically from ETH. Bitcoin is now much closer to its all-time high than Ethereum.
Analysts think that this divergence will eventually be recuperated by Ethereum bulls, resulting in a rally of like 100% or more in the price of the top cryptocurrency.
Ethereum also has fundamental trends like the release of ETH2 and institutional accumulations that should result in a move higher in the weeks ahead.
Chart of BTC's price action over the past few years with a fractal analysis to ETH's chart over the same time frame by crypto trader HornHairs. Source: BTCUSD from TradingView.com
Featured Image from Shutterstock Price tags: ethusd, ethbtc Charts from TradingView.com There's Millions of Dollars of Ask Orders Suppressing Ethereum Upside
Source: Read Full Article