Ethereum Technical Analysis: ETH Downtrend Stopped By 20-day SMA

Last Updated July 23rd 2021
4 Min Read

Daily Ethereum ETH Price Analysis
  • This Wednesday, Ethereum price flipped $1,300 from support to resistance.
  • Ethereum coins continue to move off exchanges into off-chain wallets.

Three days back, Ethereum price charted its all-time high. However, the bears have then taken back control and dropped ETH to $1,240. Let’s see what’s going on behind the scenes with the smart contract platform leader.


Key Level Stops Further Downflow

This Wednesday, the price dropped from $1,365 to $1,235, flipping the $1,300 line from support to resistance. The 20-day SMA has now stepped up to the plate to prevent any further downflow. 

eth/usd daily chart 012821

Image: ETH/USD daily

IntoTheBlock’s IOMAP shows us that the support at this zone is pretty moderate. If the sellers manage to break below the 20-day SMA, they are going to encounter strong support at $1,160. Previously, at this level, 575,000 addresses had purchased 5.7 million ETH tokens. This line is strong enough to absorb a lot of selling pressure.

eth/usd volume chart 012821

Image: IOMAP

The 4-hour chart shows us that ETH had been charting a series of lower highs and lower lows after forming the double top pattern. Following this rejection, the Ethereum price managed to flip the 20-bar and 50-bar SMA from support to resistance.

eth/usd 4-hour chart 012821

Image: ETH/USD 4-hour


$1.6 Billion Have Exited Crypto Exchanges

Ethereum whales have recently moved a whopping $1.6 billion worth of Ether (ETH) from exchanges, according to a Twitter whale bot that tracks large whale movements. Glassnode also noted that leading exchanges are recording a 15-month low of 15.4 million ETH in balance.

eth/usd glassnode chart 012821

Image: Glassnode

It is unclear as to who moved the withdrawn ETH to anonymous wallets. As per a Zycrpto report, quantum economist analyst Pedro Febrero suggested a reason for the massive ETH transfer by ETH whales. He said that it could be due to Ethereum “being locked in Defi”. However, only around 0.1 million ETH was recorded on DeFi on the day that the aforementioned amount left the exchanges, leaving Febrero’s analysis questionable. 

In a follow-up response, he reportedly said that perhaps “the number of ETH locked in the beacon chain (PoS) grew by more than 320% since December 2020.” According to the staking statistics, this analysis is more accurate. 

ETH has not only seen a new record high price for the year recently, but analysts are also now pegging the booming altcoin to reach $2000 come March. Febrero asserted that the current whale activity has opened up an entry point for the price of ETH to jump even higher. He uses the simple economics of demand and supply to back up this logic.

In our opinion, we think this means the price of ether has a greater chance of moving up. The less ether is available at exchanges, the more likely is the price to rise.


ETH Tokens Moving Off Exchanges

Santiment, an on-chain analytics platform, shared a chart showing that the exchange supply metrics continue to paint a bullish picture despite the price action. 

eth/usd santiment chart 012821

Image: Santiment

It seems like the ratio of $ETH tokens on exchanges, as well as the tokens held by the top 10 whale exchange addresses, now sit at a 26-month low. This means that people are moving their tokens from the exchanges to off-chain cold wallets, which is a very positive sign since it shows that they are not looking to sell their coins.


Ethereum Price Is Expected To Reach These Levels

If the bears manage to break below the 20-day SMA, Ethereum price is expected to reach the $1,160 support line. This line seems robust enough to absorb a lot of selling pressure.

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