Ethereum price’s weekly chart reflected a tumultuous journey with critical price points evident.
The recent weekly close at $3,193.72 showed a dip below the Fibonacci level of 0.00% at $2,791.22, indicating strong downward pressure.
However, a significant recovery ensued, driving the price up past the 50.00% Fibonacci retracement level at $3,440.53, hinting at possible bullish momentum.
Tracing Ethereum Price Movement
These oscillations of Ethereum price tested key thresholds. The price spiked to nearly $4,089.84, just shy of the $4,100 mark, before retracting sharply.
It demonstrated the volatility and uncertainty in current market conditions.
Moving forward, Ethereum could find sustained support above the $3,400 level, potentially gearing towards a rally beyond $4,000, should buyer momentum continue.
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Conversely, failure to hold above current supports could see Ethereum price revisiting lower levels to consolidate further, possibly retesting the low of $2,791.22 as a precursor to a more substantial bullish reversal in the coming quarters.
Furter analysis revealed Ethereum recently closed at the Global Liquidity Fair value, a pivotal level indicated by the dotted line in our Global Liquidity Bands model.
This position often catalyzes market reactions, and with Ethereum’s recent alignment here, it signals potential price movements.
Ethereum’s price trajectory has intersected with both the liquidity top and bottom bands through 2024, reflecting significant volatility and trading opportunities.
Given the current position, coupled with Bitcoin’s stabilization around the $90,000 mark, Ethereum might mirror this stability or potentially initiate a rally.
The future movement could either be a brief surge aligning with broader market recovery or possibly the onset of a more sustained upward trend.
Investors should watch for Ethereum to either rebound off this median level or, if downward pressure persists, seek lower support at the global liquidity bottom around $2,000.
Ethereum Price: Balance on CEX Plunging
The Ethereum balance on centralized exchanges (CEX) sharply decreased, signaling a possible supply shock.
The reserve plummeted from around 30 Million ETH in early 2022 to just over 19.5 Million by January 2025.
This sharp decline aligned with periods of significant price volatility. Notably, as the exchange reserves dipped, Ethereum‘s price saw an upward trend, particularly noticeable during 2024.
Historical data indicated that lower exchange reserves often lead to price increases due to reduced available supply and heightened buying pressures.
This trend was evident as Ethereum approached and exceeded $3K several times throughout 2024, despite overall market fluctuations.
Given the continuing decrease in CEX reserves, a supply shock could be imminent, potentially driving prices even higher.
Investors might see this as a bullish signal, suggesting that accumulating Ethereum now could be advantageous if reserves continue to dwindle and demand remains robust.
Grayscale Potential Sell-off
However the ETH rally could be hindered as Grayscale’s recent transactions transferring significant amounts of Ethereum to Coinbase Prime hinted at a possible preparation for a sell-off.
Grayscale moved 12.25K ETH and 3.518K ETH, valued at approximately $39.24 million and $11.27 million respectively, reflecting substantial potential selling pressure.
Historically, such large movements by major holders can lead to price dips, as the market anticipates a higher supply hitting exchanges.
The immediate impact saw Ethereum’s price demonstrate volatility, with potential further declines if Grayscale continues to transfer more assets.
Market observers should watch for either a stabilization at lower levels or a possible rebound if the selling pressure eases and buyers step in to absorb the surplus supply.
This strategic movement of funds could influence Ethereum’s price trajectory significantly in the short term.
