Ethereum Faces Selling Pressure But $5,000 Year-End Target Remains
Ethereum's recent decline to a four-month low raises questions, yet analysts assert that a rebound to $5,000 by year's end is still possible.
Ethereum (ETH) recently dropped to $3,160, marking its lowest value in four months. The sluggish market activity has led sellers to dominate trading, particularly on the Binance exchange. However, some analysts are optimistic about a rebound, with expectations to reach $5,000 by the end of the year.
Selling Pressure Persists But Hope Remains
During a tumultuous week, Ethereum’s price witnessed significant fluctuations, confirmed by a recent CryptoQuant report which stated that the Taker Buy-Sell Ratio has remained below 1.0, indicating a market controlled by sellers. Analyst PelinayPA emphasized that this selling pressure reflects cautious profit-taking rather than a panic-induced downturn. She foresees robust buyer interest in the $2,955 to $3,000 range before a probable ascent towards $5,000.
“I believe the price will find buyers around this level,” the trader wrote. “The main trend remains upward, and I expect these buyers to potentially push the price toward $5,000 by the end of the year.”
Similarly, technician Ted Pillows pointed out the critical need for Ethereum to reclaim the $3,500-$3,600 range to generate bullish momentum. He warned that failure to break above this crucial zone might force the price down to the $2,800 support.
Weakening Network Activity
On a broader scale, network fundamentals are declining, evidenced by a 24% drop in daily active addresses since mid-August. Historically, a decrease in blockchain activity correlates with falling prices due to reduced transaction volume and diminished interest in decentralized apps (dApps).
In the past week, Ethereum has declined 12.2%, trailing behind Bitcoin’s modest recovery. The current ETH/BTC ratio stands at 0.03284 BTC, indicating a shift in investment towards Bitcoin. Despite these challenges, Ethereum is trading above its two-year trendline support, suggesting it retains potential resistance.
As the market approaches the end of the year, both bulls and bears are observing liquidity levels around $2,800-$3,000 as key accumulation points. While the overall sentiment is tepid due to technical and macroeconomic factors, the prevailing bullish trend remains intact as long as Ethereum can sustain its support and regain pivot zones, making the $5,000 target still conceivable.
