Ethereum lost $4,000 milestone after Dencun upgrade! The next ETH price levels are:
After the Dencun upgrade was deployed at 1:55 PM (UTC) today, the Ethereum market encountered resistance holding its position near the $4,100 level, sparking a wave of selling. As a result, the price of Ethereum fell below the Fibonacci retracement level and lost the key milestone of $4,000. Market sentiment for Ethereum is currently shifting to a bearish outlook, triggered by various on-chain indicators that suggest further decline in the price is possible.
Ethereum sparks selling pressure
The Dencun upgrade was successfully implemented on the Ethereum mainnet on March 13 at 1:55 PM (UTC). Dencun, the most awaited hard fork since the merger, is expected to improve Ethereum’s scalability while significantly lowering transaction fees for layer 2 networks. entire.
The introduction of Dencun comes almost a year after the Shanghai upgrade in April 2023. This previous update allowed network participants to unstake Ether for the first time since the network switched to a proof-of-stake model following the merge.
However, the introduction of the Dencun upgrade triggered a sell-off in the market as investors began liquidating their positions. Moreover, the current sentiment among Ethereum traders is increasingly bearish, suggesting a potential downward trend.
Data from IntoTheBlock shows a significant increase in Ethereum’s Netflow metric with trading volume reaching 85.29K ETH. This development suggests that Ethereum inflows to exchanges are exceeding outflows, leading to reserves building up on those platforms. This pattern highlights the growing likelihood of a future downward price correction.
Additionally, Ether’s 1-month call put skew, which indicates the market sentiment for options trading, shifted negative, showing a preference for put options to prevent price declines. This trend also appears over a 60-day period. However, the 90- and 180-day outlook remains positive, according to Deribit data tracked by Amberdata. Additionally, QCP Capital noted that ETH spot futures spreads have narrowed slightly, in contrast to the wider spreads in the Bitcoin market. This suggests that a significant decline in the price of ETH could lead to tighter forward spreads due to the liquidation of leveraged long positions.
What’s next for ETH price?
Buyers failed to sustain ETH price under buying demand as sellers strongly defended the $4,100 level. As a result, ETH price fell below the immediate Fib channel and lost the key milestone of $4,000. However, buyers continue to accumulate during the decline and defend the support line.
If the price surges past the significant threshold of $4,000 again, it could potentially pave the way for a rise to $4,500, which could be a minor issue. Nonetheless, a break through this barrier could push the ETH/USDT trading pair towards the $4,900 level.
The recent sharp decline has pushed the Relative Strength Index (RSI) towards the midline, indicating that traders should proceed with caution. Sellers will need to pull the price below the 20-day exponential moving average (EMA) to solidify continued bearish momentum. Achieving this could lead to a correction phase for altcoins.