Ethereum has been experiencing a downward trend, characterized by low volatility and reduced trading volumes. Since June, it has been challenging for the bulls to maintain an upward trajectory, with gains often being lost shortly after they are made.
Recently, Ethereum’s value dipped below $1,600, dropping to $1,564 before experiencing a slight increase to $1,598 on Monday. According to market monitoring software, the price of Ethereum is currently standing at $1,627, reflecting a 0.3% increase on Wednesday.
Ethereum’s Number May Suggest a Shift in Trend
The 24-hour trading volume is reported to be $3.1 billion, with a total market capitalization of $192 billion. A declining wedge pattern has been observed in the short-term daily chart of Ethereum, which has enabled it to rebound from the $1,564 support level and pause at $1,600. This falling wedge, a reversal pattern, typically appears at the end of a downward trend.
It indicates that the downward trend is nearing its end and a reversal in trend is imminent. However, for the breakout to be confirmed, the price needs to rise above the wedge, accompanied by an uptick in trading volume.
Despite the gradual pace of recovery, Ethereum is predominantly held by bullish investors. This support, along with the positive outlook provided by the Moving Average Convergence Divergence (MACD) indicator, suggests that Ethereum is poised for a rebound.
Ethereum, the leading smart contracts token, has seen a significant decrease in its Total Value Locked (TVL) in decentralized finance (DeFi), dropping from around $31 billion to the present $21 billion. TVL is a measure used to monitor the cumulative value of digital assets staked in a DeFi protocol such as Ethereum, Solana, or Cardano.
A continuous decline in TVL could indicate growing sell-off pressure and the opposite. This suggests that investors are becoming impatient with the crypto winter and are pulling their staked digital assets from the Ethereum protocol, possibly in favor of other staking protocols or assets.
