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Why Ethereum (ETH) Might Struggle to Reach $4,000 in the Near Term

2 mins
Updated by Ryan Boltman
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In Brief

  • Ethereum price is trading at $3,642 but has managed to flip the 50% Fibonacci Retracement into support.
  • Owing to the recovery, ETH holders are witnessing profits again, which might result in strong sell pressure.
  • As is over $1.36 billion worth of ETH has already been sold in ten days, adding another 52,000 ETH in the past 24 hours.
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Ethereum (ETH) price bounced back this week from the lows of $3,100, reigniting hopes of new highs for the altcoin.

However, the inclination of ETH investors toward realizing profits might impede this process.

Ethereum Price Rise Warrants Restraint From Investors

Ethereum’s price increased to $3,642 at the time of writing, and in doing so, it brought investors back on the network. However, their actions are not in line with the expectations.

The transfer of ETH from one address to the other shows that the current price is higher than the last price. This signals the fact that the supply held by such addresses is bearing profits, which will push other investors to engage in the same.

Ethereum Realized Profits.
Ethereum Realized Profits. Source: Santiment

This is an indication of the potential profit booking that might take place, which will accelerate selling among ETH holders.

Read More: How to Invest in Ethereum ETFs?

ETH price declining is already at a high risk since investors have been offloading their holdings into exchange wallets. The net position change shows that about 374,130 ETH worth over $1.36 billion have been sold in the last ten days. In the past 24 hours alone, over 52,030 ETH worth $190 million was sold by the investors.

Ethereum Net Position Change.
Ethereum Net Position Change. Source: Glassnode

Thus, as profits run up, so will selling, which might result in the rally halting soon.

ETH Price Prediction: Count Down to $3,000

Ethereum’s price managed to reclaim the 50- and 100-day Exponential Moving Average (EMA). However, considering the sentiment of profit-taking, ETH may trickle down to find support at $3,336, which coincides with the 100-day EMA.

If this support is lost too, $3,031 is the next likely support floor, which is in confluence with the 23.6% Fibonacci Retracement of $4,626 to $2,539.

ETH/USDT 1-day chart.
ETH/USDT 1-day chart. Source: TradingView

On the other hand, ETH has already flipped the 50% Fibonacci Retracement. It could invalidate the bearish thesis if it sees further growth and flips the 61.8% Fib line into support.

Read More: Ethereum ETF Explained: What It Is and How It Works

The reason is that the latter is considered to be the bull run support floor and tends to reignite the rally. Marked at $3,830, ETH could climb further from here on.

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In line with the 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, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

Aaryamann Shrivastava
Aaryamann Shrivastava is a technical and on-chain analyst at BeInCrypto, where he specializes in market reports on cryptocurrencies from diverse sectors, including Telegram Apps, liquid staking, Layer 1s, meme coins, artificial intelligence (AI), metaverse, internet of things (IoT), Ethereum ecosystem, and Bitcoin. Previously, he conducted market analysis and technical assessments of various altcoins at FXStreet and AMBCrypto, covering all aspects of the crypto industry, including...