Ethereum's price experienced a significant decline today, returning to the $2500 range. While there were short-term bullish sentiments, the market is showcasing bearish dynamics.
Price Drop of Ethereum: Overview
ETH price showed signs of growth during early Asian trading but then corrected negatively. With an increase in sell options, many investors are trying to understand the leading reasons behind the downturn.
Increased Outflow from Ethereum
According to DefiLlama data, the Ethereum Chain has attracted significantly fewer investments over the past few weeks. The number of ETH has dropped from 27.99 million on May 6th to 25.22 million, representing a decrease of about 10%.
Technical Analysis and Support Levels
The 100 and 200-day Simple Moving Averages (SMA) are on the verge of a negative crossover, creating strong resistance for ETH's price. The level of $2565 proved to be a critical liquidation zone, after which the price fell below $2500. However, a bounce back toward the resistance level of $2525 may be possible.
Current bearish sentiments in the Ethereum market may lead to further price declines. Investors should monitor key support and resistance levels.
