Ethereum Long Traders Trapped: Q4 Decline Ahead?

• Long positions in Ethereum become a trap as market faces declines.
• Ethereum displays resilience in revenue and TVL supremacy.

The cryptocurrency sphere always keeps us on our toes, but Ethereum (ETH) holds its position as a major player. With Ethereum long traders trapped, a relevant question arises: Will ETH experience a decline in Q4 as well? As we move into the final quarter of the year, the factors affecting Ethereum’s price movement are crucial for traders and investors alike.

In late September, retail traders intensified their positions on Ethereum, hoping to gain from price drops. Yet, this strategy backfired, trapping many in unfavorable positions when Ethereum continued its downward trend. As we see these patterns occurring once more, the uncertainty about Ethereum’s decline extending into Q4 looms large in traders’ minds.

Bearish Trends in Ethereum’s Price Movement

Analyzing Ethereum’s recent performance reveals possible ongoing declines for the ETH/USD pair. This progression is evident as ETH currently trades below its 150, 50, and 20 exponential moving averages (EMAs), suggesting a strong bearish trend. Furthermore, the downturn is mirrored by the S&P 500 (SPX) index, which has significantly shifted below its 150 EMA, adding weight to the negative sentiment surrounding ETH prices.

Volume analysis indicates that sellers are maintaining control, reinforcing the prediction that Ethereum’s price might continue to disappoint investors with its ongoing dipping trend.

Source: TradingView

Influence of ICOs and Grayscale on Ethereum

Further insights from on-chain data highlight the influence of initial coin offerings (ICOs) and Grayscale’s transactions on the bearish outlook. Recently, one significant ICO contributor offloaded 19,000 ETH, valued at roughly $47.54 million. Initially, this participant received 150,000 ETH during the ICO, obtained at a purchase price of only $46,500, now translated to a staggering $358 million market value.

Moreover, prominent stakeholders selling their Ethereum assets amplify the downward trajectory. Historically, ETH has exhibited bearish behavior throughout the final quarter following a prosperous September.

Source: Lookonchain

Furthermore, data from Onchain Lens reveals that two previously inactive Grayscale ETF wallets moved a significant 5,837 ETH, valued at $14.17 million, to Coinbase. These wallets once held 23,026 ETH, purchased at an average price of $1,593 a year ago. Such transactions suggest that influential investors are active, which could sway Ethereum prices.

Current Sentiment Among Ethereum Traders

Both retail and larger investors seem to share a mutual bearish sentiment regarding Ethereum’s price direction. This shift in sentiment was fueled by recent geopolitical tensions impacting the crypto landscape. Consequently, Ethereum may encounter heightened selling pressures, potentially leading to additional price reductions as we progress through Q4.

Source: Market Prophit

Ethereum’s Strength in Revenue and Dominance in TVL

Amidst bearish speculations, Ethereum has shown strength in areas like revenue generation and TVL dominance. Over the past 12 months, Ethereum amassed over $140 million in gross profits across various chains. This robust performance underscores Ethereum’s position as a “land of opportunity” with its network of economic activities using ETH as its currency, which may eventually shift the trend positively.

Moreover, Ethereum continues to lead in total value locked (TVL), overshadowing other Layer 1 blockchains. With a market cap of $48.7 billion, it far surpasses competitors like Solana ($5.4 billion) and Sui ($984 million). This consistent dominance illustrates that Ethereum is maintaining its leadership position in the crypto market, even amid the bearish sentiments and emerging challenges.

Source: X

Delve into Ethereum’s [ETH] Price Prediction for 2024–2025

In conclusion, even though Ethereum faces short-term bearish pressures, its strong underlying fundamentals and market dominance might enable a rebound over time. As the market evolves, traders are advised to continuously reassess strategies and remain alert to shifts in dynamics.

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