Ethereum's price has taken a notable dip, sliding from $2,800 to approximately $1,900 in recent times, marking a significant bearish signal that hasn't been seen in two years.
Amidst this decline, there are whispers of a potential rebound on the horizon for Ethereum.
Ethereum Looks Set for a Comeback
The recent plummet in Ethereum's price below the Realized Price after two years has set off some alarms among investors, as it led to a decrease in the Market Value to Realized Value ratio, with investors facing potential losses of around 7%.
Despite the initial bearish implications, this scenario might actually be a positive indicator. History shows that the last time Ethereum encountered a similar situation, it bounced back robustly, with the MVRV ratio reviving alongside the price. This optimistic precedent has many in the market hopeful for a similar turnaround this time around.
Ethereum Realized Price and MVRV. Source: Glassnode
On a broader scale, Ethereum's momentum seems to be picking up despite the recent setbacks. The Exchange Net Position Change, which monitors the movement of ETH in and out of exchanges, is dwindling.
This trend suggests that investors are stockpiling Ethereum rather than offloading, a promising development. The prevailing view among investors is that the current low price levels present a buying opportunity with expectations of a future price surge.
This newfound investor attitude is evident in the recent acquisition of 138,000 ETH valued at around $262 million this week. The influx of funds into Ethereum underscores the belief that many investors are gearing up for a resurgence.
Ethereum Exchange Net Position Change. Source: Glassnode
ETH Price Primed for a Rebound
Currently priced at $1,897, Ethereum has witnessed a 32% decline in the past fortnight. Despite this, the altcoin is holding above the support threshold of $1,862, offering a potential base for a rebound. Should Ethereum maintain this level, it may pave the way for higher valuations in the near term.
To signify a definitive recovery, Ethereum needs to breach and solidify $2,141 as support. This crucial level is pivotal for ETH to progress to $2,344 and establish a more sustained upwards trajectory. Factors like the RSI recovery and continued investor accumulation are expected to bolster Ethereum's prospects of hitting this mark.
Ethereum Price Analysis. Source: TradingView
However, if the broader market conditions deteriorate, Ethereum could slip below the $1,862 support level, driving the price down to $1,745 or even $1,625. Such a descent would nullify the bullish outlook and hint at additional downward potential.