Originally published on: October 02, 2024
Ethereum (ETH) has seen a notable decline in price over the past day, largely attributed to increased tensions in the Middle East. The cryptocurrency market as a whole experienced a drop, mirroring the downturn in other risk-on assets such as US equities.
Jesse Colombo, a markets analyst and investor, noted that Ether suffered a 6% decrease, resulting in its largest liquidation since the significant drop on Aug. 5. Data from CoinGlass revealed that over $100 million in positions were liquidated during this recent decline, with the majority representing long positions.
While many cryptocurrencies tumbled in the past 24 hours, a few like SEISUI and INJ managed to bounce back by more than 5%, regaining over half of their losses. However, Ethereum is still trading below $2,500, largely influenced by its correlation with Bitcoin. The 90-day rolling correlation index between Ether and Bitcoin is at 0.82, the highest among all crypto asset pairs.
Ether also shows a strong correlation with US equities like the S&P 500 and Dow Jones, which faced minor corrections amid escalating tensions in the Middle East. Despite these challenges, Ethereum’s current price range might interest high-time-frame (HTF) swing traders. Technical analysis suggests that ETH/USD made a bullish break of structure on Sept. 13 by surpassing a descending trendline.
Now, with Ether back in the golden zone between 0.5 and 0.618 Fibonacci retracement lines, traders could see this as an opportunity to establish long positions. If Ethereum continues its upward momentum in the coming weeks, entering at current levels might lead to favorable returns.
In conclusion, the recent price decline of Ethereum is a reflection of broader market trends influenced by geopolitical events. As always, it is important to conduct thorough research and consider all factors before making any investment decisions.
