ETH Correction Likely Headed To $1,890 – Here’s Why
The Ethereum (ETH) market is currently experiencing a strong market correction, with several analysts pointing to potential key support levels. According to prominent on-chain analytics firm Glassnode, data from the Cost Basis Distribution (CBD) metric indicates that Ethereum is poised for a decline to $1,890, which represents its next major accumulation zone.
Why $1,890?
The CBD is used to identify significant levels of an asset’s accumulation or distribution. These identified zones often act as support or resistance and are influential on price actions. Analysts at Glassnode state that the major ETH accumulation zone below its current price is $1,890, at which investors acquired approximately 1.82 million ETH in August 2023.
A Two-Year Analysis of ETH’s CBD
Interestingly, a two-year analysis of Ethereum’s CBD shows that some of these investors who accumulated ETH in August 2023 remain active. Notably, a significant number of them increased their cost basis during the crypto market in November 2024 while executing no distribution at range highs – a behavior that signals a strong confidence in long-term price appreciation.
Additional Support at $2,100
However, it is worth stating that $1,890 is not the immediate support zone for the ETH market. Glassnode states that CBD data also highlights $2,100 as the next support zone if Ethereum’s correction continues. This support level only holds around 500,000 ETH, i.e., significantly lower than the accumulation seen at $1,890. Albeit, investors can expect $2,100 to offer some short-term support before ETH experiences a deeper correction to $1,890.
Is ETH Accumulation On Amid Price Dip?
A Six-Month Perspective on the Cost Basis Trend
In a further analysis of the Ethereum market, Glassnode also reveals that a six-month perspective on the cost basis trend shows strong investor activity with cost basis levels far higher than the current market price, particularly around $3,500.
Investor Confidence Remains Strong
Notably, this cost basis has shown a gradual decline while increasing in concentration. This development indicates that rather than initiating a sell-off, investors are actively absorbing market supply as prices decline in anticipation of long-term gains.
Conclusion
The Ethereum market is currently experiencing a strong correction, with analysts pointing to potential key support levels. With a decline to $1,890 and $2,100 as potential support zones, investors can expect some short-term support before a deeper correction. However, investor confidence remains strong, with a gradual decline in cost basis levels and increasing concentration, indicating a strong confidence in long-term price appreciation.
FAQs
- What is the next potential support zone for the ETH market?
- According to Glassnode, the next potential support zone is $2,100, followed by $1,890.
- What is the significance of the cost basis distribution (CBD) metric?
- The CBD is used to identify significant levels of an asset’s accumulation or distribution, often acting as support or resistance and influencing price actions.
- What is the current market sentiment for Ethereum (ETH)?
- The general market sentiment is bearish, with a 30.48% decline in the past month and a 17.08% decline in the past week.
- What is the current market capitalization of Ethereum (ETH)?
- The current market capitalization of Ethereum is $29.91 billion.
