Ethereum price has entered a bear market over the past few weeks, but technical analysis and government bond purchases indicate a strong recovery in the short term.
summary
- Ethereum’s price has fallen this year, moving into a bear market.
- The coin has formed a bullish flag pattern on the daily chart.
- Companies like BitMine continue to accumulate Ether tokens.
At last check on Saturday, Ethereum (ETH) was trading around $3,860, down more than 22% from its year-to-date high of $4,965, but up about 2.4% over the past 24 hours.
Ethereum’s price has a number of fundamental and technical catalysts that drive its performance. One important catalyst is Tom Lee’s Bitmine, which continues to be a hot seller.
The company purchased more coins this week, bringing its total holdings to over $6.6 billion. Lee maintained his bullish outlook for Ethereum, suggesting that Bitmine will continue to accumulate in the coming months.
SharpLink holds over 797,000 coins and The Ether Machine holds over 345,000 coins. Most notably, Huobi’s founder has pledged to create a $1 billion Ethereum treasury company.
You may also like: Will cryptocurrencies rise as the altcoin season index falls?
Proponents argue that Ethereum is a better asset than Bitcoin because of its ability to generate income. According to data compiled by SakingRewards, the staking yield on Ethereum is 3%.
Meanwhile, Ethereum ETFs performed better than ETFs tracking Bitcoin (BTC). According to the data, this week’s outflows were only $232 million, while Bitcoin outflows exceeded $1.2 billion.
Futures markets are pointing to a rebound in Ethereum price as the funding rate is above the neutral point. A positive funding ratio indicates that investors expect prices to continue rising.
Ethereum price technical analysis
ETH price chart |Source: crypto.news
The daily timeframe chart shows that ETH price has fallen over the past few weeks. It has fallen from an August high of $4,963 to a current $3,900.
This sharp decline pushed it below the 50-day and 100-day exponential moving averages. It also fell just below the key support at $4,087, the all-time high reached last December.
On the positive side, the coin has formed a bullish flag pattern consisting of a vertical line and a descending channel.
Therefore, Ethereum price is likely to rebound in the coming weeks. If that happens, the stock could move higher and retest its year-to-date high of $4,963, followed by a potential test of $5,000.
This bullish outlook will hold as long as the flag remains within the descending channel. A decline below the channel floor could indicate further downside and reach $3,000.
read more: HBAR price plummets further amid Hedera ecosystem crisis
