Key Takeaways:
- A crypto analyst warned his followers to be cautious if Ethereum closes below $4,000.
- The sudden drop in addresses holding over 32 ETH raises whale dump alerts.
- Ether flashed bullish signs as well as Ethereum price inched closer to $4,100 in the New York session.
YEREVAN (CoinChapter.com) – A crypto analyst with the Twitter handle Credible Crypto warned his 267,000 followers to “exercise caution” until Ethereum (ETH) gets back above $4,770. The ETH/USD exchange rate stood at $4,155 in the New York session Monday, slipping below a significant support bar at $4,185.
Credible Crypto provided a graph along with his prediction. He added that Ethereum’s recovery would only be solid if its price crosses over the $4,770-resistance level. Otherwise, the alpha altcoin may see a drop back to levels near $3,000.
Additionally, according to analytical platform Glassnode, ETH addresses with over 32 coins dropped to a one-month low of 108,290 quite sharply. The reason behind the dump is not entirely apparent. While it could indicate a whale dump, the “little fish” keep buying despite the price decline.
Also read: 3 reasons why Ethereum looks set to rally towards $6K in 2021.
Glassnode showed that the number of accounts holding over 0.01 ETH (roughly $40) steadily increased. It reached 19.5 million on Monday, regardless of the “caution” warnings. However, the rising number of little fish is not the only optimistic sign for Ethereum.
Bullish Ethereum price predictors
Temporary setbacks on the crypto market are not novel. Hence, the largest smart contract platform doesn’t seem too worried about the fluctuating price, as it shows bullish technicals and a steady Ethereum burn rate.
Another crypto analyst with a substantial following, Matthew Hyland, noticed a bullish setup on the ETH weekly chart. First, he spotted a “Cup and Handle,” which features a large bowl-like formation, followed by a short-term decline. Once the digital asset breaks out of the pattern, it could see gains equivalent to the “Cup” depth.
The analyst noted that Ether retested the setup support after the setback, possibly leading to another leg up.
Also read: Ethereum supply on exchanges drops as ETH price plunges over 15% in 9 days — bulls returning?
Additionally, the ETH burn rate has reached new records. As a result, the number of ETH out of circulation inched closer to one million and stood at 979,575 ETH as of publication.
As the token burn mechanism keeps taking ETH out of circulation, it could create a supply squeeze, making the digital asset a scarce resource. Thus, the price is likely to benefit as well. Furthermore, the ETH outflow from exchanges is also a bullish sign. It speaks of the traders’ decision to HODL rather than exchange them for other crypto or fiat currencies.
Moreover, Sotheby’s, one of the world’s largest brokers of fine arts, labeled ETH as ‘first-class currency.’ The company accepted the second-largest crypto as payment in their latest Banksy paintings auction.
Also read: Ethereum nears 1 million ETH burn mark as Ether jumps 9%
Credible Crypto’s prediction on a possible fall back to $3,000 could happen in the short term. However, Ethereum still looks bullish in the long haul, considering the ‘Cup and Handle’ setup on the weekly chart, the outflow from exchanges, and the steady ETH burn rate.
