Home News Here’s why pro traders expect further downside from Ethereum price

Here’s why pro traders expect further downside from Ethereum price

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The cryptocurrency market is mostly consolidating.

Ethereum has been the largest engine among major cryptocurrencies in the past 24 hours, surging nearly 5% to around $ 2,218. In general, Ether follows the movement of Bitcoin. This is a completely classic story for cryptocurrencies. When with the fall of Bitcoin, the rest of the crypto market also goes into the red zone. Or when altcoins grow in price with the growth of Bitcoin.

As of this writing, the price of ETH is 11% higher than a week ago. Although the average transaction fee on the smart contract platform has dropped to $ 2, the lowest since December.

In May, during the bullish movement of the cryptocurrency, its average commission rose to almost $ 70. But as a result of the market correction, it fell sharply.

Ethereum has so far consolidated above $ 2100 after deviating from the $ 2300 resistance level. On the other hand, Ether needs to overcome resistance at the 200 Simple Moving Average (SMA) level to pave the way for gains above $ 2,400 (former support in June).

Despite this, the bullish momentum on the daily chart looks weak. Now support at $ 2,100 remains decisive for a possible uptrend.

Ethereum price will fall in the short term

In recent days, in addition to the growth of Bitcoin, the Ethereum market has been driven by another event – the upcoming London hard fork, which has already been launched on two test networks by now, and will be launched on the last test network on July 7. Thereafter, the update is expected to launch on the Ethereum mainnet.

However, some analysts expect the Ethereum price to fall in the short term. These conclusions were drawn based on data on derivatives on ETH. And a decrease in the flow of funds to products based on Ethereum.

At the beginning of June Ether (ETH) attracted institutional investors. But at the end of June the situation changed dramatically.

According to a report from CoinShares, ETH investment derivatives suffered a record $ 50 million outflow last week. This trend was observed against the background of the fall in the ETH rate below $ 2000. The negative trend has been observed over the past four weeks.

Another indicator is the size of the premium on December futures for Ethereum, which is now in the red for Ethereum, which is a signal for bearish tendencies.

Ethereum ended June with -21% yield. Thus, June 2021 was the worst month for Ethereum since March 2020, when panic hit the markets due to the coronavirus epidemic. However, Ethereum has had positive returns in nine of the past 12 months.

The fall will be short term

However, analysts point out that the fall will be short-term. Subsequently, the dominance of the “bearish” trend will be replaced by the activation of the “bulls”. Thus, before the start of the rally, we will expect a slight decrease in their value.

Ethereum in 2021 has all chances to renew its historical maximum many times, but this movement is unlikely to happen now.

The current course takes into account the positive sentiment of investors in general in the cryptocurrency market and the progress of the Ethereum team in updating and moving to Ethereum 2.0. However, for further growth some additional incentives are needed, experts emphasize. In their opinion, they will appear by the fall of 2021, when the launch dates for the next stages of the Ethereum 2.0 update are approaching.

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