Ethereum Holders Buy Heavily as Price Nears October 2023 Levels

Ethereum has experienced a challenging month and a half, with its price nearing a 17-month low at $1,802 at the time of writing. Despite this ongoing downtrend, which nearly sent ETH into a bear market, key investors have remained optimistic.

As Ethereum approaches these significant levels, many market participants believe that a price rebound could be on the horizon.

Ethereum Investors Capitalize On Low Prices

Ethereum’s supply on exchanges has dropped to a six-month low, indicating that investors are increasingly holding their assets off the market. This drop in exchange supply is often seen as a bullish sign because it suggests that long-term holders (LTHs) are accumulating more ETH at these low price levels, anticipating future price appreciation.

These investors are not willing to sell, demonstrating strong conviction in Ethereum’s long-term value. The decrease in exchange balances also indicates less short-term trading activity. This suggests that many investors are waiting for the price to rebound before making any moves.

Over the past month, Ethereum’s Liveliness indicator has declined, signaling that the selling pressure is weakening. Liveliness measures the activity of long-term holders, and a decline generally points to accumulation rather than selling. 

This drop reflects the growing sentiment among Ethereum’s long-term investors, who are increasing their holdings and expecting the price to recover in the future. The decline in Liveliness suggests that many are confident in Ethereum’s fundamentals and are less concerned about short-term fluctuations.

This accumulation phase suggests that Ethereum’s market sentiment may be shifting. The confidence of LTHs—who hold significant influence over the asset’s price—could lead to a strong upward momentum once the market conditions improve. 

ETH Price Needs A Nudge

Ethereum is currently trading at $1,802, just below the resistance level of $1,862. The price has been stuck under this barrier for six weeks, continuing the downtrend that has defined much of the recent price action. However, if Ethereum can break above $1,862, it could signal the end of the downtrend and the start of a price recovery.

Given the current market sentiment and accumulation by key holders, it is possible that Ethereum will continue to gain upward momentum. If Ethereum successfully breaks through the $1,862 resistance, it could move toward the $2,000 mark, regaining some of the losses from the previous weeks. 

On the other hand, should the bearish sentiment intensify, Ethereum’s price may dip further toward its 17-month low of $1,745. Failure to secure support at this level could lead to even greater losses. This could extend the recent downtrend and leave many investors exposed to a prolonged bearish market.