The post Why Did Ethereum Drop? Will ETH Price Crash To $2K? appeared first on Coinpedia Fintech News
After attempting to follow Gold in a bullish outlook in the past few weeks, Ethereum (ETH) led the altcoin industry in significant losses in the past 24 hours. The large-cap altcoin, with a fully diluted valuation of about $297 billion and a daily average traded volume of around $20 billion, dropped nearly 8 percent in the last 24 hours to exchange about $2,474 on Wednesday during the early Asian session.
The sudden Ethereum price decline in the past 24 hours resulted in forced liquidation of more than $102 million, mostly involving long traders.
Top Reasons Ethereum Price Dropped Today
Increased Fear of Choppy Prices Ahead
Ethereum’s fear and greed index dropped from around 53 percent, neutral, to 32 percent, fear, in the past 248 hours. The fear of further Ethereum price capitulation is evident in the daily and weekly charts.
According to popular analyst Peter Brandt, Ethereum price will likely continue in bearish sentiments in the near term after consistently closing below $2,814.
From a technical standpoint, Ether price has suffered bearish sentiment after the daily death cross between the 50 and 200 Moving Averages (MAs). Additionally, the daily Relative Strength Index (RSI) has been rejected at the 50 percent level, suggesting the bears are in control.
Whales Capitulation
According to on-chain analysis, Ethereum whales have accelerated profit-taking in the last few days. The fear of further crypto capitulation in September has seen more whale investors exit the market.
For instance, Wintermute deposited over 17.5k Ether, worth more than $43 million, to the Binance exchange in the past 24 hours. Another whale investor was spotted selling over 5k Ether via Binance earlier today.
Low Demand from Spot Ether ETFs
Since the historic approval and launch of spot Ether ETFs in the United States, the demand has remained relatively low. Led by Grayscale’s ETHE, the US spot Ether ETFs registered a net cash outflow of about $3.45 million on Tuesday, thus the total cash outflow being $481 million to date.