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Ethereum Tumbles, Falls Below $3400, Sparks Concern

Ethereum Tumbles, Falls Below $3400, Sparks Concern

The price of Ethereum (ETH) has recently dropped dramatically. 

A summary of probable causes for Ethereum’s decline.

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Prominent expert highlights massive inflows into ETH exchanges. 

Bears dominate the derivatives market. 

Substantial liquidation of the crypto market. 

The second-largest cryptocurrency by market capitalization worldwide, Ethereum, has recently swept the cryptocurrency world. Its price fell to $3,312 today, a nearly 4.84% decline. This decline, along with a weekly decline of over 8%, has shocked investors and traders in the cryptocurrency market and given rise to rumours about the volatile industry. 

Several factors contributed to the $4k loss in ETH during the last 30 days, which set off a bearish market trend for the cryptocurrency. This is a thorough examination of the possible causes of the recent decline in the second-most popular cryptocurrency in the world. 

Principal Causes of the ETH Dip 

Other variables contributed to Ethereum’s sharp decline, which made investors less confident. Several of them include: 

Exchange Inflow for ETH Rises As Regulatory FUD Increases 

Ethereum recorded its highest weekly influx into the exchange since September 2022. Valued at an astounding $720 million, this weekly inflow reflected growing investor angst as a possible ETH ETF in the legal rumours presented a mysterious picture to the market. 

Prominent cryptocurrency market researcher Ali Martinez highlighted an additional $1.47 billion in ETH exchange influx during the last three weeks. The factors hinted at Ethereum’s bearishness, aligning with its recent price movement, indicating selling pressure, profit-taking actions, and unfavorable market attitudes.

Calculated Derivatives Show a Bearish Trend 

Today’s decline reflected in ETH’s open interest, volume, and OI-weighted funding rate, as Coinglass’s derivatives data revealed. Volume decreased 38.87% to $39.29 billion, while open interest fell 2.98% to $13.01 billion. This indicated a significant drop in fresh capital entering the futures market for the token, accompanying decreased market activity. The OI-weighted funding rate of 0.0191% and bear market dominance confirmed ETH’s current decline.

Liquidation of the Crypto Market 

In the meantime, there have been significant liquidations in the cryptocurrency market over the last day, involving 82,047 traders and $223.23 million. Notably, OKX saw the largest liquidation order on OKX – ETH-USDT-SWAP, valued at $1.76 million. 

Simultaneously, Ethereum took a hit, with liquidations totaling $49.16 million on the last day, primarily from long traders at $32 million and short traders at $17.16 million. This considerable liquidation worsened Ethereum’s bearish trend and highlighted the cryptocurrency market’s heightened volatility.

 

The Market Dynamics of Ethereum 

Exchange View’s research revealed that there is now a selling mood for ETH on the market. A downturn may be indicated by the market’s continued lack of purchasing interest, accompanied by an RSI circling around 45. This further suggests that the price may drop, even though Ethereum’s current bearish picture is consistent with the data. 

ETH’s concurrent declines in market capitalization and 24-hour trading volume reflected the cautious mood in the market, with decreases of 4.88% and 16.64%, bringing them to $398,294,964,857 and $19,928,788,604 respectively.

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