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Here’s What Might Have Triggered Ethereum’s Decline Below $1,600

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Here’s What Might Have Triggered Ethereum’s Decline Below $1,600

After what has been two weeks of an incredible rally for the price of Ethereum, the digital asset seems to be running out of steam. ETH’s price has now declined once more below $1,600 after a sharp downturn on Tuesday. The culprit for this seems to be growing FUD across the community.

FUD Could Have Been The Trigger

According to Santiment, the social dominance of Ethereum grew rapidly in the last couple of days. While this can sometimes be a good thing, it tells a negative story this time around. Ethereum is now dominating 21% of cryptocurrency discussion on social media and the on-chain data aggregator says this might be evidence that FUD might be behind the dip. However, this may not be the only reason.

A report from Bitcoinist had previously shown that profit-taking in large assets such as Bitcoin and Ethereum had been ramping up with the increase in price. Santiment also highlights this in its post, pointing to the spike in the profit-taking ratio on January 20. Taking this in concert with the growing FUD, it presents a recipe for disaster for the digital asset.

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ETH social dominance indicates FUD | Source: Santiment

Another prominent event was the Wormhole attacker started moving the stolen funds around. On Monday, the attacker moved over $155 million in ETH to OpenOcean which they proceeded to exchange for staked ETH tokens such as stETH and wstETH.

The dumping of these coins on the open market saw sell pressure mount on ETH during this time. It contributed to the already declining momentum, resulting in the current dip in the price.

Can Ethereum Recover From Here?

Despite the recent decline, the overall sentiment for Ethereum is still skewing largely toward buy. This is because the cryptocurrency is still trading well above its 50-day and 100-day moving averages. And even with the decline, it continues to trend around its 200-day moving average.

What this shows is that, at least in the short to mid-term, there is still a lot of bullish sentiment surrounding the digital asset. Add in the ample support that has built up around $1,500 over the last couple of days and Ethereum is still presenting as a formidable choice of investment.

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ETH price falls below $1,600 | Source: ETHUSD on TradingView.com

Investors are also seeing good profits during this time with 57% of all holders in profit. Figures like these also help to push a bullish narrative for the digital asset as more investors try to take advantage of the dip and move into the green. Overall, as long as ETH maintains its momentum and trading volume continues rising, it’ll retest the $1,600 resistance once more. 

ETH’s price is changing hands at $1,555 at the time of this writing. Its price is down 5.27% in the last 24 hours but trading volume is up 11.91% over the same time period to be sitting at $9.32 billion.

Follow Best Owie on Twitter for market insights, updates, and the occasional funny tweet… Featured image from Bitcoinist, chart from TradingView.com

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Analysis

Bitcoin, Ethereum Technical Analysis: BTC Nears $24,000 Following Weekend Rally

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Bitcoin, Ethereum Technical Analysis: BTC Nears $24,000 Following Weekend Rally

Bitcoin started the week trading near a five-month high, as prices consolidated the weekend’s gains. Prices rose close to $24,000 on Sunday, following a breakout of a key resistance level. Ethereum fell back below $1,600 on Monday, after moving to a one-week high during yesterday’s session.

Bitcoin

Bitcoin (BTC) remained near a five-month high on Monday, following a strong rally towards $24,000 over the weekend.

Following a high of $23,919.89 on Sunday, BTC/USD fell to a low of $23,166.83 to start the week.

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Sunday’s surge saw BTC bulls push prices to their strongest point since August 26, however these same traders have already begun to retreat.

BTC/USD – Daily Chart

Looking at the chart, the decline commenced following a failed breakout of a ceiling at 85.00 on the 14-day relative strength index (RSI).

As of writing, the index is now tracking at 72.19, with a floor at 65.00 the only current visible target for bears.

Should this zone be hit, it is highly likely that BTC will be trading close to a support point at $22,500.

Ethereum

Ethereum (ETH) also edged lower to start the week, as sentiment shifted following a breakout of the $1,600 level

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ETH/USD slipped to a bottom of $1,582.18 earlier in the day, as bulls were unable to sustain Sunday’s high at $1,653.73.

Yesterday’s peak saw the world’s second largest cryptocurrency climb to its strongest point in one week, however traders used this as an ideal moment to secure recent gains.

ETH/USD – Daily Chart

The move saw ethereum marginally break out above a ceiling at $1,650, however bearish sentiment around this mark has reigned supreme over the last three months.

A breakout below a floor of 60.00 on the RSI also contributed to the decline, with the index now tracking at 58.40.

In the event today’s decline continues in the coming days, it is possible that ETH could be heading towards a floor at $1,550.

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Will sentiment in cryptocurrencies be bullish or bearish this week? Leave your thoughts in the comments below.

Eliman Dambell

Eliman brings an eclectic point of view to market analysis. He was previously a brokerage director and online trading educator. Currently, he acts as a commentator across various asset classes, including Crypto, Stocks and FX, whilst also a startup founder.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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DeFi

Cream Finance exploiter moves $3.3M ETH in January

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Cream Finance exploiter moves $3.3M ETH in January

Cream Finance exploiter moves $3.3M ETH in January Oluwapelumi Adejumo · 50 mins ago · 1 min read

The Cream Finance exploiter transferred 365.7 ETH — worth $600,000 — to an unknown centralized crypto exchange TradeOgre, Peckshield tweeted.

1 min read

Updated: January 30, 2023 at 8:01 am

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Cover art/illustration via CryptoSlate

Blockchain analytical firm Peckshield tweeted that the Cream Finance (CREAM) exploiter transferred 365.7 ETH — worth $600,000 — to an unknown centralized crypto exchange TradeOgre on Jan. 30.

The exploiter had transferred 2,070 Ethereum — roughly $3.3 million — to the same platform since Jan. 9, according to Etherscan data.

The exploiter was moving funds from a $119 million exploit in October 2021, according to another blockchain security firm, Certik. At the time, the attacker used multiple flash loans to raise the price of yUSD and borrowed more assets than the attacker collateralized on the decentralized finance application.

TradeOgre exchange

TradeOgre is a small crypto exchange with minimal know-your-customer policy and anti-money laundering compliance.

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The exchange’s website shows that it focuses on privacy coins and there are no signs of an email address or a phone number for customer support. It’s Twitter account also appears deserted — last updated Nov. 28, 2022.

Posted In: Ethereum, DeFi

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Analysis

Bitcoin, Ethereum Technical Analysis: BTC Hovers Near $23,000 To Start The Weekend

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Bitcoin, Ethereum Technical Analysis: BTC Hovers Near $23,000 To Start The Weekend

Bitcoin started the weekend hovering near $23,000, as markets continued to react to personal consumption data in the United States. Figures released on Friday reported that spending fell by 0.2% last month, despite overall consumer sentiment moving higher. Ethereum remained close to $1,600 to start the day.

Bitcoin

Bitcoin (BTC) remained close to the $23,000 level on Saturday, as markets continued to react to Friday’s U.S. personal consumption data.

Following a high of $23,417.72 late on Friday, BTC/USD fell to an intraday low of $22,880.60 earlier in the day.

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This came as bitcoin was once again unable to break out of a key resistance level at $23,500, leading to a resurgence of bearish sentiment.

BTC/USD – Daily Chart

In addition to this, the 14-day relative strength index (RSI) has dropped below the 80.00 mark, and looks to be headed for a floor at 76.00

Should momentum continue in a downward direction, it is likely that BTC will collide with a floor at $22,400.

Currently, the index is tracking at 78.59, with BTC/USD trading at $22,930.60.

Ethereum

After a brief stint moving back above $1,600 late on Friday, ethereum (ETH) started the weekend once again below this level.

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ETH/USD dropped to a bottom of $1,568.69 on Saturday, less than a day after hitting a peak of $1,617.00.

Volatility in ethereum has been heightened in recent days, following a failed breakout attempt of the $1,645 level earlier this week.

ETH/USD – Daily Chart

Following weeks of being overbought, price strength has begun to decline, with the 14-day RSI now tracking below its floor at 63.00

As of writing, the index is at a reading of 62.50, with ethereum at $1,582, with a floor at $1,550 a possible target for sellers.

Register your email here to get weekly price analysis updates sent to your inbox:

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Do you expect cryptocurrency prices to fall further this weekend? Leave your thoughts in the comments below.

Eliman Dambell

Eliman brings an eclectic point of view to market analysis. He was previously a brokerage director and online trading educator. Currently, he acts as a commentator across various asset classes, including Crypto, Stocks and FX, whilst also a startup founder.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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