Ethereum, the world's second-largest cryptocurrency, experienced a significant drop in price on Tuesday, falling over 2% to $1,540. This level has not been reached since March 12th. Despite attempts by Ethereum bulls to maintain the price above $1,600, they were unsuccessful in recovering the lost ground.
According to on-chain data provider Santiment, a substantial amount of dormant Ethereum moved from older wallets during this period. "This decrease in the average age of ETH holdings while prices are declining is indicative of capitulation, often signaling potential reversals in the market," Santiment reported.
Key support levels for Ethereum are currently at $1,550 and $1,370. These are the levels where bounce back probabilities are higher. As of press time on Tuesday, Ethereum's price managed to rebound from the first support zone and is trading at $1,579 with a market cap of $189 billion.
However, if Bitcoin's price continues to decline, it could put downward pressure on Ethereum's price, potentially leading it to fall further to $1,407. Conversely, a rebound in Bitcoin’s price could exert an upward pressure on Ethereum’s price, potentially turning the $1,575 resistance level back into a solid support zone. This could pave the way for Ethereum to surpass the $1,800 mark and reach the significant psychological milestone of $2,000.
Santiment’s data also highlighted a lack of significant selling activity from long-term holders in recent days. Despite this, the overall market sentiment appeared pessimistic with a decline in the mean coin age. These factors collectively underscored the bearish sentiment in the market and suggested that Ethereum was likely not in an accumulation phase.
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