Key Points
- Ethereum’s price has fallen below the $3,000 mark.
- The supply of Ethereum in profit has decreased by about five million.
Ethereum experienced a significant price drop at the end of April. This downturn affected various key metrics related to the cryptocurrency.
Ethereum’s Price Drop
On April 30, Ethereum’s price fell by 6.29%, trading at roughly $3,013. Despite this, it managed to cling to the $3,000 price level. However, the decline continued, pushing Ethereum’s price below the $3,000 mark, with its price around $2,972 at the time of the latest update.
Initially, Ethereum looked set to surpass its short-term moving average, which acted as resistance in the $3,300 to $3,500 range. The recent downturn, however, pushed Ethereum further from this target and forced it to cross another significant threshold on its Relative Strength Index (RSI). At the time of writing, Ethereum’s RSI had fallen below 40, indicating a strong bearish trend.
Surge in Liquidation Volume
Analysis of Ethereum’s liquidation chart on Coinglass showed a significant increase in liquidation volume on April 30. The cryptocurrency saw its highest liquidation volume in weeks, totaling over $115 million by the end of that trading day.
Further analysis revealed that long positions accounted for approximately $97.4 million, while short positions contributed $18.11 million to the total. This surge in long liquidation marked the most significant volume seen in weeks, indicating that traders who had taken long positions or expected Ethereum’s price to rise had their positions forcibly closed.
There has been debate about the performance of the Hong Kong ETFs launched on April 30, with some expressing disappointment due to low volume. The total volume was around $12.7 million, with Bitcoin making up over $9.7 million and Ethereum over $3 million.
Others, however, believe that the volume was decent and not a failure, as some have suggested. The slow start contributed to the negative movement in Ethereum’s price. Additionally, fears about the Federal Reserve potentially maintaining its hawkish stance at the Federal Open Market Committee meeting on May 1 may have contributed to the decline.
With no expectations of a rate cut due to ongoing inflation in the US economy, the crypto market has historically shown declines leading up to FOMC meetings as investors exercise caution in anticipation of policy changes.
A sharp decline was observed in Ethereum’s supply in profit. Between April 28 and April 30, Ethereum’s supply in profit fell from over 87% to approximately 83%. This change indicates a decrease in volume from over 119 million to around 114 million Ethereum. It suggests that more holders are increasingly holding onto their Ethereum assets at a loss as the price continues to drop.
