The world’s second-largest cryptocurrency Ethereum (ETH) has participated in the broader market rally, gaining more than 40% in the past month. On Wednesday, February 1, the ETH price was up another 7% and is currently trading at $1675 with a market cap of $204 billion.
The recent price surge in ETH comes amid the broader market’s reaction to Wednesday’s FOMC meeting. As the 25 basis point interest rate hike was on the expected line, the crypto market cheered.
However, after a strong rally since early 2023, ETH investors and holders should remain cautious. On-chain data shows that profit-taking in ETH is on the rise and that the altcoin may be gearing up to shed some of its February gains.
On-chain data provider Santiment reported that a look at ETH’s Aroon indicator, on the daily chart, shows that bullish sentiment has weakened significantly in recent weeks. The Aroon upline was 21.43%.
Usually, when the Aroon Up line approaches zero, it suggests a weak uptrend and a distant high. This basically indicates the possibility of a trend reversal.
Courtesy: Santiment
Ethereum (ETH) price fluctuations
Coingape reported that ETH price was stuck between $1682 and $1506 for the past two weeks. Currently, it is quite close to upside resistance, and any breakout above that could prepare Ethereum for a further rally. In bullish conditions, ETH price could rise 40% from here i.e. to USD 2,400.
However, the Aroon indicator is pointing to a trend reversal and there is every possibility that the ETH price could move lower from here. Thus, any close below $1,500 could weaken the bullish case theory, pointing to a further price correction to $1,350.
Many experts believe that the year 2023 could be the year of recovery for crypto. It will be interesting to see if ETH can sustain momentum, or if a partial pullback is imminent.
The post Here’s Why February Can Be Rough for Ethereum (ETH) Holders appeared first on CoinGape.
This post Here’s why February can be rough for Ethereum (ETH) holders.
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