The Federal Reserve announced, as expected, that it would maintain its main policy rate, as outlined in its economic summary. Ethereum’s price seemed to react positively to this news, holding above $1,600. Yet, in the last few hours, Ethereum couldn’t maintain its trade above $1,600 and dipped beneath Fibonacci levels due to reduced exchange outflows. Moreover, a massive selloff among whales has intensified the bearish pressure on the price chart.
$11 Million Worth Of Long Positions Liquidated
Over the last few hours, ETH price has dropped heavily below the crucial $1,600 mark, triggering a wave of selling activity among investors. Coinglass reports that a massive $11 million in long positions was wiped out in just a few hours. This liquidation indicates increased selling pressure, especially as ETH struggled near its resistance of around $1,620. For those new to the concept, long-liquidation refers to traders who anticipated a price rise having to close their positions, typically at a deficit, because the price didn’t move as they forecasted.Glassnode indicates that Ethereum’s exchange outflow has hit a one-month low, with 6709 ETH, pointing to a growing exchange reserve. A drop in outflow implies that more Ethereum is staying in exchanges, with fewer ETH being taken out. This rise in exchange reserves indicates a higher availability of Ethereum for sale, which is generally seen as a bearish indicator. Additionally, the ratio of ether to bitcoin plunged to its lowest in 14 months as major token holders, including Ethereum’s co-founder Vitalik Buterin, transferred coins to exchanges, potentially signalling an intent to sell. Currently, the ETH-BTC ratio approached 0.05957, as per TradingView data, marking its lowest point since the previous July. However, a positive funding rate suggests a majority of traders are bullish on Ethereum, expecting its price to rise from the bottom.
What’s Next For ETH Price?
Recently, bulls failed to hold the ETH price above the crucial $1,600 level as the altcoin faced a heavy selloff near the high of $1,620. As a result, ETH price dropped below crucial Fib channels and touched a low near $1,570. As of writing, ETH price trades at $1,587, declining over 2.7% from yesterday’s rate. The extended wick on the candlestick pattern indicates buyers are defending further decline. The declining 20-day EMA at $1,624 and the RSI nearing the overselling region suggest a bearish advantage. However, bulls will likely attempt to send the price above the 20-day EMA. If Ether surges past $1,623, it might give the bulls an edge. This could potentially push the ETH price towards $1,674. However, if it drops below $1,531, it would imply that the bears are still in the game, possibly driving the price further down.