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Ethereum price may continue to fluctuate within its current range, with traders remaining cautious as they navigate this volatile period.
Ethereum traders suffered significant losses on Monday, with an estimated $17 million in liquidations, despite signs of recovery in the broader crypto market. These liquidations were particularly severe on centralized exchanges such as Binance, OKX, and Huobi Global (HTX) where many long traders were forced to close positions.
According to data from the blockchain analytics platform CoinGlass, long traders were hit the hardest, with nearly $14 million wiped out in the last 24 hours alone. In contrast, short sellers experienced far fewer liquidations, with approximately $3.2 million affected during the same period.
Liquidations amid Market Recovery
The heavy liquidations occurred even as the overall crypto market rebounded after weeks of sharp declines. Data from CoinMarketCap reveals that the global crypto market capitalization now stands at $2.24 trillion, with Bitcoin (BTC) accounting for more than half of this value.
Bitcoin, the leading crypto asset in the industry, currently holds a market cap of $1.26 trillion and maintains a dominance of 56.30% in the market. Over the weekend, BTC saw a strong resurgence, helping to stabilize the broader crypto market after dipping significantly earlier in the month. On Friday, the crypto asset reclaimed the $60,000 level and continued its upward momentum to peak at $64,000 on Monday, August 26. However, it has slightly declined to $63,857 at press time.
This positive price movement impacted the entire crypto market, including Ethereum, the second-largest digital asset by market capitalization. Last week, Ethereum posted a nearly 5% increase, reaching $2,800, according to CoinMarketCap data. This recovery sparked optimism among investors and traders, raising hopes of a sustained upward trend.
Sharp Ethereum Decline Triggers Liquidations
However, despite this optimism, the market turned against Ethereum traders on Monday. The digital asset experienced a sudden decline of approximately 0.5%, dropping to $2,744. This seemingly small dip was enough to trigger automatic liquidations for traders with leveraged positions, leading to a wave of forced sales and mounting losses.
Ethereum’s inability to maintain its upward momentum has caused concern among traders. The digital asset had shown a relatively steady trend until a sharp spike on August 23, which briefly raised hopes of a breakout. However, since then, Ethereum has struggled to hold onto key support levels, leading to further market volatility.
Resistance Levels and Market Outlook
Technical analysis indicates that Ethereum is facing strong resistance at crucial levels. The Relative Strength Index (RSI), which measures the asset’s price momentum, is currently hovering around its neutral line, indicating a lack of clear directional momentum in the market.
Additionally, Ethereum has failed to break through the short-moving average (yellow line), which is positioned around $2,900. The long-moving average (blue line), another significant resistance level, stands around $3,200. For Ethereum to establish a sustained bullish trend, it would need to overcome these barriers.
Until then, Ethereum price may continue to fluctuate within its current range, with traders remaining cautious as they navigate this volatile period.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Cryptocurrency News, Ethereum News, News
Chimamanda is a crypto enthusiast and experienced writer focusing on the dynamic world of cryptocurrencies. She joined the industry in 2019 and has since developed an interest in the emerging economy. She combines her passion for blockchain technology with her love for travel and food, bringing a fresh and engaging perspective to her work.
