Ethereum’s Downwards Pressure May Be Perpetuated by Waning Holders
Ethereum (ETH) – along with most major cryptocurrencies – has been facing significant selling pressure in recent times and has failed to regain its previous support level of $185, despite Bitcoin expressing some hints of bullishness.
New data suggests that Ethereum’s investors have a significantly higher turnover rate than Bitcoin’s investors, which may signal that any prolonged downwards trend in the aggregated crypto market will prove to be dire for ETH, as its holders may be more prone to jump ship than Bitcoin’s investors are.
Ethereum Bounces from Daily Lows, But Downtrend May Just be Getting Started
At the time of writing, Ethereum is trading down over 1% at its current price of $174.3, which marks a slight drop from its daily highs of $177 that were set yesterday.
It is important to note that ETH did bounce yesterday evening after dipping to lows of $168, signaling that this price could be a strong region of support for the cryptocurrency.
One important trend that analysts and investors alike should closely watch is the average time that investors hold their ETH tokens, as it may signal that any downwards momentum will be significantly perpetuated by traders who jump ship.
Intotheblock, a cryptocurrency research group, recently explained in a tweet that Bitcoin investors hold their crypto for over two times as long as Ethereum investors do, which signals that investors will likely find greater stability in BTC than they will in ETH.
“One of our 30+ indicators is the avg time a token is held. Ever wondered if a cryptocurrency is being held for longer than others? i.e. How does #BTC compares to #ETH? The Answer: #Bitcoin avg holding period is more than 2x of ETH,” They explained in a recent tweet.
One of our 30+ indicators is the avg time a token is held
Ever wondered if a cryptocurrency is being held for longer than others? i.e. How does #BTC compares to #ETH?
The Answer: #Bitcoin avg holding period is more than 2x of EHT. pic.twitter.com/2DdAgCMFMO
— intotheblock (@intotheblock) September 5, 2019
Will ETH Soon Visit Next Region of Major Support?
Josh Rager, a popular crypto analyst on Twitter, recently shared his thoughts on Ethereum, explaining that he believes there is a decent chance that it continues to drop lower until it reaches its next major level of support around 0.012 BTC, which is down significantly from its current price of 0.0167 BTC.
“$ETH Zoom Out. In between major support areas. Would love to see price between 0.012 to 0.013. But want to wait for a confirmation,” Rager said in a recent tweet.
$ETH Zoom Out
In between major support areas
Would love to see price between 0.012 to 0.013
But want to wait for a confirmation pic.twitter.com/50DvtVTCdL
— Josh Rager
(@Josh_Rager) September 7, 2019
Naturally, Bitcoin’s price action in the near-term will likely have a massive impact on that of ETH’s, but any prolonged downwards trend may lead to a bout of capitulation for Ethereum due to the short-term nature of its investors.
Featured image from Shutterstock.
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Cole Petersen, Khareem Sudlow