Key Points
- Ethereum’s price rebounded from a critical support level, aiming for $2,500, but potential sell-off risks remain.
- The Ethereum ecosystem has significantly matured due to mainstream adoption of its smart contracts.
The price of Ethereum (ETH) has recently bounced back 1.4 percent from a critical support level of around $2,332.
As of Friday, October 11, during the mid-London session, it was trading at about $2,411.
Ethereum’s Market Performance
The top-tier altcoin, with a fully diluted valuation of approximately $290 billion and a daily average traded volume of around $13.2 billion, rebounded from the lower border of a logarithmic triangular pattern in the daily time frame.
If the bullish sentiment persists, Ethereum’s price is likely to rally towards $2,598, which coincides with the 0.618 daily Fibonacci Extension.
However, unless Ethereum’s price consistently closes above the critical resistance of around $2,800 in the coming weeks, the possibility of further correction cannot be overlooked.
According to market data analysis, Ethereum’s price has already established a robust support level of around $2,300, where 2.4 million addresses purchased 52.6 million Ether.
As a result, if Ethereum’s price breaches the $2.3k support level, the entire altcoin ecosystem could be facing a major sell-off as investors look to minimize losses.
In the daily time frame, the bearish sentiment has the upper hand, with the ultimate target of $2,100, which represents a 12 percent drop from the current level.
With Bitcoin‘s price also showing midterm weaknesses, Ethereum’s price is likely to drop further to flash out leveraged traders before rebounding towards a new all-time high.
Against the Bitcoin pair, Ethereum has been forming a potential reversal pattern, characterized by a double bottom and a bullish divergence on the Relative Strength Index (RSI).
Ethereum Whales and Network Upgrades
The US spot Ether ETFs have registered a net cash outflow of over $560 million, led by Grayscale’s ETHE.
Meanwhile, on-chain data shows that crypto whales have been offloading their holdings led by the Chinese government that intends to sell over $1.3 billion in the near term.
The Ethereum Foundation and Vitalik Buterin have been selling their coins every week since the beginning of the year.
The Ethereum ecosystem has significantly matured over the years due to the mainstream adoption of its smart contracts by both retail traders and institutional investors.
The notable Ethereum network upgrades in the past have helped Ether compete with other layer one (L1) projects led by Solana.
For instance, the introduction of Ethereum staking through the Beacon chain has resulted in more than 34.7 million Ether staked, representing around 28.8 percent of the total circulating supply.
The introduction of the burn feature on the Ethereum network over three years ago has resulted in more than 4.4 million Ether obliterated to date.
The Ethereum network has grown to a web3 powerhouse with over $44 billion in Total Value Locked (TVL) and over $84 billion in the stablecoins market cap.
Some of the top projects on the Ethereum network include OpenSea NFT marketplace, Uniswap, and Tether USDT.
