This recent drop has pushed Ethereum’s Relative Strength Index (RSI) to the lowest level since August 2023, indicating that it might be oversold.
Ethereum’s price has experienced a significant drop, falling by up to 5.78% in the past 24 hours. This decline has pushed its Relative Strength Index (RSI) to the lowest since August 2023, indicating that Ethereum might be oversold. Market veteran Michael van de Poppe reported this sharp decline, which suggests strong bearish momentum in the market.
#Ethereum reaches the lowest RSI (Daily) since the collapse in August '23.#Altcoins have reached their lowest RSI (Daily) ever or of this cycle.
Clear capitulation. pic.twitter.com/9eehaITkQI
— Michaël van de Poppe (@CryptoMichNL) July 5, 2024
As of now, Ethereum’s price is hovering around $2,956. It previously faced key resistance between $3,800 and $4,200, levels it struggled to break through, leading to the recent decline. Ethereum now faces crucial support at $2,480. If the price falls below this level, it could trigger further declines toward $2,145.
Despite this recent drop, Ethereum’s trading volume remains stable, indicating no panic selling. This stability suggests that while market sentiment is currently bearish, there might be a potential rebound or consolidation phase on the horizon.
Impact on Ethereum Investors
An analysis of Ethereum addresses shows that many are “Out of the Money.” These addresses bought ETH at prices ranging from $2,951.47 to $3,400.33 and are currently incurring losses. This indicates that many investors are facing losses at the current price level.
Additionally, a recent report from CoinShares highlighted a continued outflow from crypto investment products, totaling $30 million over the past three weeks. Ethereum alone saw a significant outflow of $61 million. In contrast, Bitcoin-related exchange-traded products (ETPs) experienced an inflow of $10 million, bringing the total assets across all Bitcoin ETPs to $67.57 billion.
Interestingly, other digital assets recorded positive net inflows. Multi-asset ETPs attracted $18 million, while Solana, Litecoin, Chainlink, and XRP saw inflows of $1.6 million, $1.4 million, $600,000, and $300,000, respectively. The significant outflow from Ethereum compared to the inflows into other digital assets suggests increased bearish sentiment, specifically towards Ethereum.
In summary, Ethereum is experiencing significant bearish momentum, with its price declining and the RSI indicating oversold conditions. While trading volume remains stable, suggesting no panic selling, the continued outflow from Ethereum investment products indicates growing bearish sentiment among investors.
