Gerhard, an analyst from Bitcoin Strategy, warns that Ethereum (ETH) could fall to $1,880 based on recent on-chain stats. 

According to the analyst, on-chain data shows stagnant transactions and active address growth over the past three years, contributing to lackluster price movement. Additionally, he points out that Ethereum’s total value locked in decentralized finance (DeFi) platforms has sharply declined, dropping over 90% from previous levels.

Gerhard also noted a concerning trend, pointing out that ETH’s market share has fallen due to high transaction fees and reduced value transacted since its 2021 peak. According to him, this decline in market dominance, now at 57%, coupled with over 90% of Ethereum holders remaining in profit, raises the risk of a substantial sell-off. The analyst warns that if the bearish market conditions persist, the altcoin could see a 37% price drop to hit the level. The bear calls align with predictions from analysts at More Crypto Online, who also predict a possible Ethereum fall to $2,498.

He also points out that the transition from proof of work to proof of stake highlights Ethereum’s underperformance. Despite a stable trading range since May 2021, whether ETH can maintain its current levels or revisit lows seen in September 2019 remains uncertain. Furthermore, he states that the ongoing adoption of a Bitcoin ETF could pressure Ethereum’s position, potentially exacerbating its underperformance.

The analyst also states that the current market dynamics show ETH’s precarious 16.5% dominance in the altcoin market. According to him, this measurement is critical as it indicates potential further declines in altcoin values if Ethereum’s price falters, given that their liquidity is directly linked to Ethereum’s market behavior. However, despite the bear calls, Lark Davis predicts ETH will hit $15,000 in the long term.

Ethereum Price Review: How Is ETH Looking Today?

Analysing ETH, we noticed it was trading at $3,103 as of 1:52 p.m. UTC, according to stats from CoinMarketCap, which aligns with the price on the trading chart. Looking at the charts, Ethereum exhibits volatility with a “double bottom” pattern. This pattern suggests a potential trend reversal from the preceding downtrend, signaling a bullish outlook where buyers might gain control. 

4-hour ETH/USD Chart | Source: TradingView

Looking at indicators, we notice that the Average Directional Index (ADX) is at 36.68, which indicates a strong trend.  Conversely, the Money Flow Index (MFI) is 71.14, close to the overbought threshold of 80. This could indicate that the asset might become overvalued and that a price correction could be imminent.

Disclaimer

This article is provided for information only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.