Ethereum is facing fresh sell pressure after the cryptocurrency failed to make a new monthly high earlier this week, incurring a heavy technical rejection from the $412 resistance zone.
Failure to Launch Gives, Ethereum Bears Catch Up
ETH’s current price has so far found technical support just above the $370 support area. This support coincides with the expiration of $80 million worth of Ethereum options today.
On-chain data analysis also shows a decreasing number of 24-hour active addresses, signaling a drop in transaction volume on Ethereum’s blockchain. On Oct. 23, when ETH/USD failed to trade above $420 resistance, it was preceded by a sharp decline in both prices and transaction volume.
Data gathered from the crypto analytics platform Santiment also highlights that from Oct. 23, Ethereum addresses holding 10,000 to 1,000,000 coins have dropped sharply.
This metric suggests that whales have been selling some of their holdings or booking profits ahead of today’s Ethereum options expiration event, as well as the upcoming U.S. election on Nov.3.
It should be noted that these addresses are diametrically opposed to addresses holding more than 1,000.000 coins, which continue to increase their ETH portfolios. This phenomenon would point to short-lived selling pressure on Ethereum.
Miners’ balances are beginning to recover, too, suggesting that miners are returning to their bullish outlook. Likewise, it appears that buyers are scaling into these price dips; hence near-term support areas should be monitored closely as they are sensitive areas for Ethereum to resume any bullish momentum.
The technicals surrounding Ethereum show that the cryptocurrency has retraced back under a rising channel, which should be considered bearish. A sustained break under this pattern may reinforce selling pressure targeting $365, $340, and possibly the $320 area.
However, if the move under the $380 support level proves to be a false breakout, then a bounce in prices back towards the $450 resistance level is highly probable in the short-term.