Sun, December 22

Ethereum (ETH) To Likely Consolidate Before Reaching $4,000

Why Ethereum Price Drops Post-Dencun Upgrade? News
  • Ethereum poised for consolidation before aiming for $4,000 again, indicated by Pi Cycle Top Indicator.
  • Ethereum finds robust support between short-term and long-term moving averages, signaling stability and potential consolidation.
  • ETH’s NUPL oscillates between “Optimism — Anxiety” and “Belief — Denial” zones, reflecting balanced sentiment for gradual price climbs amidst consolidation.

Ethereum (ETH) finds itself at a crucial juncture. According to recent price analysis, ETH could be entering a period of consolidation before attempting to reach the $4,000 mark once again.

Ethereum is currently in a brewing consolidation phase, according to the Pi Cycle Top Indicator, a tool for identifying potential market tops. The indicator’s upper boundary is set near $4,231, while the lower boundary rests around $2,750, creating a bandwidth that allows for market stabilization rather than a peak.

Ethereum’s Position Between Averages Indicates Robust Support 

Positioned between the short-term (111-day) and long-term (350-day multiplied by 2) moving averages, the current ETH price’s parallel trajectory without a crossover event suggests the establishment of a robust support level. The current price activity and this lack of convergence support the idea that ETH may be entering a consolidation phase.

When the price surpasses the longer-term average, it could indicate an overheated market poised for a downturn. On the other hand, if the price falls below the short-term average, it could indicate an asset’s undervaluation. Ethereum’s position between these averages hints at a potential period of stable growth.

NUPL Oscillation Reflects Market Indecision and Sentiment Balance

The Net Unrealized Profit/Loss (NUPL) indicator for Ethereum has been consistently oscillating between the “Optimism — Anxiety” and “Belief — Denial” zones, reflecting the market’s indecision.

This pattern suggests that investors are alternating between cautious optimism and a stronger conviction in the asset’s potential, without fully committing to an overarching trend.

The NUPL’s brief stays in the “Belief — Denial” zone help prevent market overheating, while the sentiment balance between zones may prepare ETH’s price for steady climbs. Without strong greed or fear dominating the market, a gradual rise in Ethereum’s price is more likely than volatile swings.

The current consolidation phase could provide a foundation for a stable uptrend, but it is crucial to approach the market with caution and consider the potential risks.

Seasoned Crypto Content Writer, Editor and Journalist who entered the cryptocurrency industry out of sheer passion and love for writing.