Published on mei 11, 2024, 12:35 am
Image source: Fox News
- TLDR: Ethereum price action is focused on a crucial line that short-term holders are monitoring closely. New ETH holders risk falling into losses due to market dynamics. Despite drawdowns, Ethereum shows resilience with diminishing price corrections. Short-term ETH holders hold coins near $3,000 cost basis, prompting potential panic amid market decline. The market awaits regulatory signals on spot Ether ETFs, while long-term holders are not heavily selling despite profit margins. No investment advice provided.
The current focus in the Ethereum (ETH) price action revolves around a crucial line that short-term holders of the cryptocurrency are closely monitoring. Ethereum, often touted as owning a piece of crypto history, has been experiencing some challenges in its performance compared to Bitcoin (BTC) in this particular cycle. According to Glassnode’s recent newsletter, “The Week On-Chain,” new ETH holders are now facing the risk of falling into losses amidst the ongoing market dynamics.
Both Bitcoin and Ethereum have encountered downward price movements subsequent to Bitcoin’s block subsidy halving in April. Despite this, Ethereum enthusiasts have faced substantial setbacks lately, particularly after BTC/USD observed a significant drawdown not seen since the FTX incident in late 2022. Glassnode notes a parallel drawdown structure in Ethereum’s price action with less severe corrections post-FTX lows, indicating resilience during pullbacks and reduced volatility across the digital asset sector.
While the intensity of ETH price drawdowns is diminishing, specific investor groups might find themselves slipping into negative territory concerning their holdings. Short-term holders of Ethereum (holding coins for 155 days or less) currently hold coins at an aggregate cost basis near $3,000. ETH/USD is hovering around this level, with a recent brief dip below swiftly recovered according to data from Cointelegraph Markets Pro and TradingView.
Glassnode also highlights Ethereum’s market value to realized value (MVRV) metric as an indicator that a potential market decline could trigger panic among short-term holders. MVRV assesses unrealized profits and losses for these entities at a given price point, suggesting that current spot prices closely align with recent buyers’ cost basis who may react anxiously to downside volatility.
Looking ahead, Glassnode mentions that the market is eagerly awaiting regulatory signals from U.S. authorities regarding the status of spot Ether exchange-traded funds (ETFs). On another front, long-term holders (LTHs) seem reluctant to engage in mass selling activities at existing prices despite many having secured substantial profit margins. The newsletter indicates increased divestment by long-term BTC holders during the all-time high rally period.
To reiterate, it’s essential to note that this article does not provide any investment advice or recommendations. Investment decisions inherently carry risks, and readers are strongly advised to conduct thorough research before making any financial commitments.
Original article posted by Fox News
