Here is the next ETH price trend.
Ethereum has had a tumultuous start to the week, and indications are that more cuts may be on the way. Selling pressure on Ethereum is increasing as Bitcoin loses momentum and drops below immediate support levels in recent hours. This downward trend has been reinforced by various on-chain metrics, which now indicate that a 10% drop is likely for Ethereum in the coming hours.
Ethereum eyes for a 10% drop
According to data from Coinglass, Ethereum liquidity has increased significantly, surpassing $42.7 million in total. Of this money, about 40 million dollars will be spent on liquidation of long-term positions.
A bullish indicator is the increasing supply of ETH on exchanges. According to additional data from CryptoQuant, Ether exchanges reached a four-week high of 15.8 million ETH on October 21. The net balance between centralized exchange wallets showed a significant increase between October 15 and October 20. Marketing platforms began to proliferate.
The increasing supply of ETH on exchanges suggests that investors are transferring their tokens from self-custodial wallets to exchanges, indicating a willingness to sell.
Additionally, since mid-June, Ethereum's Total Locked Value (TVL) has been decreasing, as shown in the deflation chart below.
TVL on the Layer-1 network fell from a peak of $66 billion on June 3, down 57% to $42.3 billion on August 5, rising to $48 billion now. Additional data from Defilama indicates that Ethereum's TVL has decreased by more than 2% in the last 30 days, due to the poor performance of other top layer-1 protocols such as Solana, which has increased by 22% in TVL during the same period.
The rising TVL in Solana reflects traders' interest in the DeFi ecosystem, and shows Ethereum's inability to attract new users due to relatively high transaction costs, especially for those looking to start new projects.
This strengthened the sentiment dominance on the Ethereum price chart, causing the price to drop by 10%.
What's next for the price of ETH?
The price of Ether faced heavy selling pressure as the bears controlled the price around $2,800, indicating that the market has rejected the previous divergence. The selling pressure increased, causing the price to drop below the 200-day exponential moving average (EMA) at $2,552. As of writing, ETH price is trading at $2,517, down more than 4% in the last 24 hours.
There is minor support at the 50-day simple moving average (SMA) at $2,487. However, if this level does not continue, the ETH/USDT pair may drop to $2,400 and then to $2,330.
Conversely, if the price rises above the 50-day SMA, it indicates strong demand at lower price levels. At this point, the bulls may try to push the price up to $2,850, which can serve as a major resistance.
As the RSI level is getting closer to the oversold territory, we could see a rebound on the ETH price chart soon.
