Ethereum (ETH) finds itself at a pivotal crossroads, grappling with immense selling pressure while simultaneously exhibiting underlying signs of strength from its network and long-term holders. The coming days are critical as the cryptocurrency battles to maintain key price levels and confirm its next trajectory.
Facing Immense Sell Pressure and Key Resistance
Recently, Ethereum witnessed an extraordinary sell-side imbalance, with its Net Taker Volume plummeting to -$418.8 million. This represents one of the largest daily sell-offs in its history, typically signaling a local market top. Despite this intense selling, ETH has shown resilience, holding near the $3,643 mark. However, the asset failed to reclaim the crucial $3,950 resistance level, which is vital for validating a bullish cup and handle formation. Sustained consolidation below this point could invalidate the pattern, potentially leading to further price retracement if bulls don't swiftly regain control.
Underlying Strength from Network Activity and Long-Term Holders
In stark contrast to the bearish price action, Ethereum's on-chain metrics paint a more optimistic picture. Network activity has surged, with New Addresses climbing by nearly 30% and Active Addresses increasing by over 3%. This growing user engagement often provides a solid foundation for price stability and eventual recovery, suggesting underlying strength despite current market pressures. Furthermore, long-term holders (LTHs) continue to show strong conviction, retaining significant unrealized gains. While some short-term overvaluation is indicated by the NVT Ratio, the steadfast commitment from these seasoned investors provides a crucial cushion against deeper declines, underscoring their confidence in Ethereum's long-term valuation. This confluence of extreme selling pressure, a critical price battle at $3,950, and robust on-chain growth places Ethereum at a decisive juncture. The market's ability to absorb sell-offs, combined with sustained user activity and long-term investor confidence, will determine if bulls can push ETH higher or if a more significant correction is on the horizon.
