Here's Why Ethereum May Struggle to Reach $2000
Ethereum [ETH] joined the bullish bandwagon like the rest of the market. The asset had flawless growth. At the time of publication, ETH was trading for $1,906 after a daily increase of 5.3%. Before experiencing a decline, the asset managed to hit a peak of $1,928.
The rising surge was evident on the Ethereum four-hour price chart. The altcoin showed a strong bullish sentiment despite the low trading volume. The MACD indicator confirmed this. Earlier this week, the MACD line crossed the signal line in a bullish crossover.
This suggested that Ethereum might maintain its upward trend in tandem with the bullish market mood. Reaching $2,000 now that the asset has surpassed the $1,900 mark appears possible. But there are a few challenges that can make Ethereum's path difficult.
Exchange deposits for Ethereum are still increasing.
The year 2022 turned out to be difficult for the whole crypto sector. But it was especially crucial for the Ethereum network, which recently underwent a major upgrade that fundamentally altered its ecology. One significant adjustment was the rise in staking activity, which led to a steady reduction in the amount of ETH held in exchange balances. A recent study claims that 19 million ETH, or roughly 15% of the tokens that are eligible for staking, have been successfully staked on the Ethereum network.
With only 14,967,790.336 ETH still available on exchanges, this measure has currently fallen to a five-year low.
Even though the amount of ETH on exchanges has decreased, this is generally viewed as a positive indication, but there are worries that the market may be under pressure to sell. Exchange deposits have been rising and have now reached a five-month high, according to a recent Glassnode chart. This also demonstrated that ETH has been entering exchanges, which may have increased selling activity and pushed the price lower.
ETH's course in the future is still unknown. However, in the coming days, more clarity might become apparent.