Ethereum Faces Bearish Outlook Amid Potential Trend Reversal

A prominent crypto analyst is raising concerns about Ethereum, suggesting the top altcoin could be showing signs of a bearish trend.

In a recent update Justin Bennett shared that Ethereum might be forming a diamond reversal pattern, a technical signal that often indicates a shift in trend. If this pattern is confirmed, Ethereum could potentially drop below $2,500.

It’s not a pattern I trade, but $ETH could be forming a diamond reversal pattern. 👀

The objective is $2,485 if it confirms with a close below support. Nothing is confirmed yet.#Ethereum pic.twitter.com/jQI082xnzI

— Justin Bennett (@JustinBennettFX) October 16, 2024

While Bennett clarified that he doesn’t typically trade this pattern, he pointed out that if Ethereum closes below its support level, the target could be around $2,485. At the time of his update, Ethereum was trading at $2,642, showing a slight gain over the past day.

Shifting focus to Bitcoin, Bennett noted that the open interest in BTC derivatives is at its highest point since August, with the $65,800 level being crucial for maintaining bullish momentum.

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However, he also highlighted a concerning trend: large Bitcoin holders, or whales, seem to be reducing their long positions compared to retail investors. Historically, this has led to a 10% decline in Bitcoin’s price. While it’s still early, Bennett advised keeping an eye on this development.

Alexander Zdravkov

Alexander has been working in the crypto industry for three years, during which time he has established himself through his active participation in monitoring market dynamics and technological innovations. His interest in cryptocurrencies and new technologies is not just a professional commitment, but a deep personal passion. He follows the news in the sector daily, analyzes trends, and is excited about every new step in the development of blockchain solutions. His enthusiasm drives him to continuously learn and share knowledge, as he sees the future in digital finance and its role in global transformation.