As Bitcoin plunged below the $ 61,000 zone, Ethereum couldn’t hold out for long either. On the daily period, ETH traded at $ 4,177, noting a rate of 11.54% daily price drop and 13.10% weekly price loss.
So, shortly after Ethereum saw its highest weekly closing price of $ 4643 (vs USD on Binance), how did the highest coin fall? Well, signs of a short-term bearish price rotation could be spotted before the price collapses.
Firstly, Ethereum was seeing considerable consolidation after achieving an ATH of $ 4,868 on November 10. While the price candles on the daily chart closed red for almost a week, the supply of ETH on the exchanges also saw sudden moves.
On November 14, just days before losses of more than 10% hit the top altcoin, more than 100,000 Ethereum (nearly $ 450 million) were removed from trading.
After this big withdrawal, the same could be interpreted in two ways. One a long term bullish outlook and the other a short term bearish scenario that can pretty much be seen now. The first scenario shows that there is a demand for ETH from the bigger players at current price levels, which was a good sign.
The first scenario could be inferred keeping in mind that there is a whale that has finished buying at the moment, which means that if the purchasing power goes down, a decrease in prices in the short term could occur. ‘follow.
However, keeping the big picture in mind, it can be noted that Ethereum’s supply on the exchanges stood at 13% and saw a sharp decline alongside the drop in prices. A year ago, that number stood at 23.29%, and the almost 50% drop in that number indicates that ETH is safely moving to cold wallets for DeFi and HODLing related activities.
So what’s the short-term fate of ETH?
While there are long-term bullish signs, there are lingering fears that ETH may retest the $ 4,000 mark as it tested the $ 4,100 mark on November 16. However, recently Ethereum experienced one of its biggest dormant circulation days ever, with 1.82 million ETH mobile addresses for the first time in five years.
While this move could still lead to further price cuts in the near future, as Santiment reported, there was not much to fear. It looked like the ETH move was most likely due to internal transfers between Kraken wallets and wouldn’t cause strong selling pressure, at least for now.
Additionally, ETH’s correlation with BTC was heading towards historically low levels, even though the top two coins fell together. As seen below, the previously low correlation levels of all time have been good for the price of ETH, as seen in late April and June.
For now, however, as Bitcoin continued to decline, the larger market seemed weak, in terms of price. Ethereum’s price also appeared to be trending down, with the coin’s daily RSI falling almost vertically. In addition, the price of ETH on a daily also fell below the MA 20, this will be a crucial level to watch in the near future and a move above the same level could ensure a recovery.