beincrypto.com
Bitcoin has been firmly in the driving seat over the past couple of weeks and recent on-chain analytics suggests that things could get worse for crypto’s number two, Ethereum.
Analytics and blockchain data firm Santiment has been delving into some on-chain metrics for Ethereum, which is still at the heart of DeFi, and they’re not looking promising from a price perspective.
The research has observed that Ethereum miners have been offloading and trader sentiment has slowed recently.
Ethereum Rally Running Out of Steam
When PayPal announced that it would be accepting crypto payments, which included Ethereum, Bitcoin prices jumped to their highest levels for the year, but ETH barely moved.
What followed was a fair bit of negative sentiment about the news as the payments giant would not allow digital assets to move to or from the platform.
Ethereum did not break its 2020 high in this last rally which could indicate that the FOMO has dried up and it is priming for a larger correction. ETH is down around 18% from its highs this year of $480 roughly two months ago.
Santiment charts suggest that miners could be dumping as their dormant coins started moving during the upswing. Additionally, Ethereum’s weighted social media sentiment has taken a dive back into bearish territory over the past week.
Another chart shows that the number of DEX trades has declined for the past month, but on the upside, this is good for gas prices. According to bitinfocharts.com, the average transaction price has fallen to $1.39 which is back where it was in early August before all the degen farming began.
The final chart, and probably the most revealing, shows a sharp drop in miner balances which coincided with the most recent local top of just over $415 on October 22.
ETH Price Outlook
ETH prices, which many suggest are still undervalued, have not shared the same FOMO and performance as Bitcoin. It has also failed to mark a new monthly high, as observed by industry analysts.
ETH dumped to $385 on Tuesday but has since recovered and is trading a touch above the $404 level at the time of writing. The next major support zone on the daily time frame is around $370 where the 50 day moving average lies.
Below that is a long drop down to $320 and if the bears really start to maul the markets, DonAlt’s prediction of a fall into the high $270 area may be on the cards.
This would be even more likely if Phase 0 of ETH 2.0 doesn’t materialize before the end of the year.