Ethereum Shaky Despite Burning Millions of ETH, Will Bulls Uptrend?

Ethereum Shaky Despite Burning Millions of ETH, Will Bulls Uptrend?
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The Ethereum (ETH) performance mirrors the general state of the crypto market, looking at the candlestick arrangement in the daily chart we can see a trend. Technically, ETH buyers have a chance, provided prices trend above the $1,800 and $1,820 support zone.

If there is a break below, confirming losses of the last day, cracks might begin forming, heaping pressure on the coin. Still, the immediate trend supports bulls because prices remain within the June to July 2023 trade range.

Currently, ETH is trending above a primary support line. How prices react will shape the short to medium-term trend as we advance. The price trajectory would be fanned by fundamental factors emerging in the coming days.

Eth Burns

The lull across the board has significantly impacted price and sentiment. Still, looking at Ethereum, the recent migration of y00ts from Polygon to Ethereum has triggered more activity on DeGods. Following news of this move, trading volumes have surged, helping Ethereum burn more coins.

Currently, Ultra Sound Money data shows that Ethereum has taken over 3 million ETH out of circulation since the implementation of EIP-1559. Ethereum is burning roughly half of the total coins issued by the network in the last two years.

Because of this, ETH is gradually becoming deflationary, with activity pushing more coins out of circulation. Still, how well layer-2 solutions are adopted over the mainnet could significantly influence how fast ETH becomes deflationary.

Ethereum (ETH) Price Analysis

Engagement over the last trading weeks, from mid-July when prices peaked, has been tapering. The daily chart shows that sellers have been firm, taking over and aiming to peel back gains. However, ETH bulls have been steady, keeping prices above the $1,800 and $1,820 support zone.

The immediate reaction points lie at around $1,890 and $1,820. As long as prices consolidate inside this range, aggressive traders can wait for a clean break out with expanding volumes before loading up, depending on the breakout direction.

Currently, ETH is at around the 50% and 61.8% Fibonacci retracement zone of the June to July 2023 trade range. It is a critical level that validates the uptrend.

Any close above $1,890 might see ETH roar to $2,100 in a buy-trend continuation formation. Meanwhile, losses below $1,800 could trigger a sell-off toward $1,780 and $1,700 in the short to medium term.

Technical charts courtesy of Trading View.

Disclaimer: The opinions expressed do not constitute investment advice. If you wish to make a purchase or investment we recommend that you always conduct your research.

If you found this article interesting, here you can find more Ethereum news.


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