Ethereum (ETH) price failed to breach the $2,200 resistance since the completion of the Shapella upgrade. On-chain gauges are flashing red flags as speculators remain poised for short positions. Will ETH lose its current support level?
After a positive initial reaction to the completion of the Proof of Stake transition, the second largest cryptocurrency by market capitalization now faces an uncertain short-term future. Notable data analytics company, IntoTheBlock highlighted An increase in the volume of large ETH transfers in the wake of the Shabella upgrade. As ETH 2.0 holders start looking for alternative ways to deploy their newly withdrawn holdings, could this affect the price of Ethereum negatively?
Ethereum Stakers holders load their carts
According to Glassnode, the supply of coins deposited on exchanges has increased by 100,000 ETH in the past week. Usually this means that investors looking to sell can now do so more quickly and easily.
The chart below shows how the balance of ETH on exchanges increased from 18.09 million to 18.20 million coins between April 13th and April 17th.
When more currencies are held on exchanges, they are often more readily available for trading. As more ETH 2.0 holders withdraw their coins, they may soon build up selling pressure and trigger a potential price correction in the coming days.
Moreover, analysis of aggregate order books for specific markets shows that more ETH for sale is currently outsold around current prices.
According to data compiled by IntoTheBlock, around a price limit of +/- 30%, there are open sell orders for 6 million ETH. But at the moment, buyers have placed orders for only 5.2 million Ethereum.
When exchange order books contain larger sell order sizes than buy orders, it generally means more supply than demand for the asset being traded. This may lead to price reduction as sellers may have to lower their prices to attract buyers.
In short, the influx of ETH coins on exchanges, potential selling pressure built up by newly undiscovered coins, and imbalanced exchange order books could combine to cause a correction in the price of Ethereum.
ETH Price Prediction: Ethereum Bulls could offer support near $1,850
In/Out of Money, further indicates that Ethereum price is likely to drop towards $1980. However, 972,000 titles that bought 1.36 million at an average price of $1,980 could provide support.
If the decline continues, ETH could drop further towards $1850. But here, there is a more significant support line of 1.42 million addresses and 5.77 million coins.
However, the bulls are invalidating the bearish outlook if ETH rises above the $2,100 resistance area. But the 632,000 addresses holding close to 20 million ETH currently pose a strong challenge.
If the bulls can clear this level, Ethereum price could reach $2,400 before hitting another major resistance of 600 addresses with 500,000 coins.
In line with Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult with a professional before making any financial decisions.