Why did Ethereum drop? Why isn't there a 'Christmas rally' today?
Everyone is waiting for the 'Christmas rally' in cryptocurrency, but Ethereum is not cooperating today, dropping about 4% to a trading price of $3354.5. Although market sentiment looks quite 'greedy', the actual situation is different. So, what happened to Ethereum?
From the four-hour chart, Ethereum hit a wall at $3524, and neither the 50-period nor the 20-period moving averages could support the price. On December 23, a 'death cross' occurred, indicating that the price would fall, and it seems that this is indeed the case.
Trading activity also decreased by 10.06%, and it seems everyone is withdrawing funds. Although the open interest increased by about $1 billion, the ratio of long to short positions is 0.846, with 54.17% of ETH open futures trading being short, indicating that everyone is not optimistic about Ethereum's short-term prospects.
However, there is good news. Data from CryptoQuant shows that Ethereum's reserves on exchanges are decreasing, indicating that investors are moving assets to cold wallets and are increasingly confident in Ethereum's long-term potential, which may signal a price increase. There are now only 19.05 million ETH tokens left on exchanges.
Data from Farside also shows that on December 24, $53.6 million flowed into Ethereum ETFs, including $43.9 million into BlackRock's ETHA ETF, $6.19 million into Bitwise's ETHW, and $3.45 million into Fidelity's FETH.
So what will happen to Ethereum next? Although market sentiment currently looks bearish, the decrease in exchange reserves indicates that investors still have confidence in Ethereum's future. Although the price has dropped, the momentum is slowly increasing. Everyone is asking, 'Why did Ethereum drop today?' but we should really look at the bigger picture.
As mentioned in Bitcoin analysis, the market loves to surprise traders. When sentiment is too pessimistic, cryptocurrencies often move in the opposite direction, creating opportunities for those who understand market trends.
For the upcoming layout direction, I will guide everyone to aim for the profitable opportunities in altcoins, especially those with high potential projects, with an expected upside of over ten times being quite feasible. If you want to make big money in a bull market, like + comment, and I'll take you through the entire bull market!
