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Ethereum’s RSI has dropped to 36%, signaling a potential buying opportunity. With multiple catalysts ahead, could ETH be ready for a major rebound?

Ethereum’s RSI Signals Potential Rebound

Ethereum’s Relative Strength Index (RSI) has fallen to 36%, a historically oversold level. This has caught the attention of crypto investors, who are eyeing potential buying opportunities.

Despite Bitcoin’s strong bullish momentum, Ethereum has underperformed for months. Analyst Marzell highlights that ETH has lagged behind Bitcoin for nearly six months.

However, Markus Thielen of 10x Research believes this high-risk, high-reward setup could present major opportunities.

Ethereum: A High-Risk, High-Reward Opportunity

Thielen notes that Ethereum’s recent price fluctuations have been more unpredictable than Bitcoin’s. However, upcoming ETF approvals, network upgrades, and new trading launches could fuel a major turnaround.

At the moment, market sentiment is highly bearish. Analyst Michaël van de Poppe pointed out that ETH short positions are at an all-time high, reflecting negative investor sentiment.

However, Thielen argues that excessive pessimism has historically led to strong buying opportunities. He sees Ethereum’s current dip as an attractive risk/reward setup, especially with Solana losing momentum due to issues like the TRUMP meme coin collapse and slowing coin issuance on Pump.fun.

Analysts Predict a Strong Ethereum Rally

Other analysts are also bullish on Ethereum.

🔹 Crypto Caesar highlights that Ethereum has historically performed well in the first quarter of every fourth cycle. ETH surged 353% in Q1 2017 and 167% in Q1 2021, suggesting March could be a turning point.

🔹 Crypto Rover predicts that Ethereum “is about to explode”, projecting ETH could hit $22,500 if it follows historical trends.

🔹 Some analysts even warn, “you are not bullish enough.”

With multiple catalysts ahead, could Ethereum be on the brink of a major breakout?

Ethereum (ETH) is experiencing a period of uncertainty, with key indicators pointing to weak momentum. The Directional Movement Index (DMI) reveals a lack of strong trend direction, as the Average Directional Index (ADX) has remained below 20 for several days. This suggests market indecision and consolidation.

Moreover, the number of ETH whale addresses has declined since reaching an 11-month high. This shift indicates potential changes in market sentiment. As ETH’s exponential moving averages (EMA) show no clear direction, the coin’s next move depends on breaking key resistance levels or maintaining critical support zones.

Ethereum DMI Indicates Weak Market Trend

The Ethereum DMI chart highlights a weak trend, with the ADX currently at 12.5 and staying below 20 for the past four days. The ADX measures trend strength, and values under 20 indicate indecisiveness.

Additionally, the positive directional indicator (+DI) stands at 24.9, while the negative directional indicator (-DI) is at 30.8. This indicates that bearish momentum slightly outweighs bullish pressure. However, due to the weak ADX, this bearish pressure is not driving the price significantly.

With the current indecision, Ethereum may continue sideways movement until a stronger bullish or bearish force emerges to break the stalemate.

Decline in ETH Whale Addresses Signals Market Shift

The number of Ethereum whale addresses holding at least 1,000 ETH hit an 11-month high of 5,690 on January 15 but has since dropped to 5,663. This decline suggests a potential redistribution of capital.

Tracking whale activity is crucial as their accumulation or distribution often indicates broader market trends. The recent decline may be linked to increasing interest in alternative assets such as Bitcoin (BTC), TRUMP, and Solana (SOL). As capital shifts to these assets, ETH could face selling pressure and reduced dominance in the crypto market.

If this trend continues, Ethereum’s price may struggle to sustain current levels, posing challenges for bullish investors.

ETH Price Prediction: EMA Lines Offer No Clear Direction

Ethereum’s EMA lines currently show no clear trend, reflecting market indecision. Despite a price increase from January 13 to January 16, ETH’s performance in the past week has lagged behind major cryptocurrencies.

While Bitcoin surged by 17%, XRP by 36%, and SOL by 43%, Ethereum’s price only rose by 7.6% over the same period.

If ETH gains momentum and breaks the key resistance level at $3,473, it could aim for the next target at $3,745. However, if the uncertainty persists and downward pressure intensifies, ETH may test the support level at $3,158. A further drop could push prices down to $2,927.

Conclusion

Ethereum’s price remains uncertain as weak momentum and declining whale activity contribute to market indecision. Traders should watch key resistance and support levels closely to gauge the coin’s next move.

Ethereum co-founder Vitalik Buterin has shared updates on Ethereum’s upcoming “The Verge” upgrade, a key development that could significantly improve the network’s efficiency. This upgrade has the potential to spark renewed interest in Ethereum and possibly lead to an ETH price rebound amid current market volatility.

What is “The Verge” Upgrade?

In a recent blog post, Buterin revealed that “The Verge” aims to make it easier for users to run a full-verifying node on the Ethereum blockchain. Currently, verifying the blockchain is limited to devices like laptops, which restricts accessibility. With the new upgrade, even mobile or browser wallets could handle verification tasks, making blockchain participation more convenient for users.

Initially, “The Verge” focused on Verkle trees, a data structure designed to validate transactions without storing the entire blockchain on one device. Over time, the upgrade’s vision has broadened to further maximize resource efficiency. The goal now is to reduce data storage needs, allowing nodes to rely on cryptographic proofs to verify blocks.

SNARKs: Revolutionizing Ethereum’s Verification

A significant part of “The Verge” upgrade is the use of SNARKs (Succinct Non-Interactive Arguments of Knowledge), an advanced cryptographic verification method. This innovation could allow Ethereum’s blockchain to be verified on smaller devices like smartwatches. The introduction of SNARKs supports the move towards “stateless clients,” which would require less storage and improve the blockchain’s overall performance. This is a major step forward in making Ethereum more accessible and efficient for users and stakers.

ETH Price Rebound on the Horizon?

The anticipation surrounding “The Verge” upgrade has led analysts to predict a potential rebound in Ethereum’s price. Despite the current volatility in the crypto market, technological advancements like these often boost investor confidence.

Currently, ETH is trading at $2,605.23, down 1.5%, with its trading volume decreasing by 16%. However, some analysts believe that if Ethereum can surpass key support levels, a rally toward $4,000 may be possible, fueled by the excitement over this crucial upgrade.