Ethereum Bulls Fading: Will NFT Activity Revive Demand?
Ethereum is struggling, looking at the daily chart. After recent losses, the probability of gains above $2,800 remains low
Ethereum is still stuck in a sideways consolidation in a possible accumulation. That prices are still below $2,700 but above August lows mean there is general indecision. Technically, the August 8 bar defines the current short-term trend. Though it is bullish, things will rapidly change should prices tank since the bar is also engulfed by the bears of August 4 and 5. Therefore, though traders are confident of what lies ahead, the failure of bulls to breach $2,800 points to weakness, at least for now.
Traders are closely monitoring price action. With the coin inside the bear bar of August 5 and the bulls of August 8 failing to break higher, there is a state of balance. Ethereum is down 3% in the past day, pushing weekly losses to 5%. At the same time, engagement is below average, at just $12 billion.
The following trending Ethereum news could shape the short-term trend:
- There is a recovery in NFTs after the “decimation” in 2022. As trading volume fell by over 90%, yesterday, investors moved to buy $825,000 worth of CryptoPunks. These NFTs are some of the most sought-after.
- Bulls are struggling amid dropping DeFi activity, outflows from spot Ethereum ETFs, and an unexpected rising supply. Since Dencun, ETH has been inflationary, with more coins hitting the circulating supply that it is being burned.
Ethereum Price Analysis
ETH/USD edged lower yesterday, closing in the red territory.
At this pace, sellers appear to have the upper hand, and price action aligns with the August 5 bar.
Technically, the August 5 bar is crucial, defining the current trend unless there is a breakout above $2,800. In that case, buyers may take over, confirming the August 8 gains. This formation might set the base for another leg up to $3,500.
Before then, aggressive sellers can considering shorts on every attempt below $2,800.
Their immediate target would be August 2024 lows of around $2,100.
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