Ethereum’s price has been consolidating around $2.6k in February, offering some hope for recovery. However, on-chain metrics suggest that the altcoin’s sellers are not yet exhausted. The recent Bybit hack saw $1.46 billion worth of Ethereum siphoned out of a cold wallet, leading to an unprecedented amount of withdrawals from the exchange. Despite this, ETH was down 2.64% at the time of writing.
A crypto analyst noted a pattern emerging from Q1 2024, indicating that Ethereum might be making cycle lows similar to Bitcoin’s lows during black swan events like COVID or the FTX crash. Metrics show that Ethereum still has room to go lower, with the sellers exhaustion metric indicating a potential low-risk price bottom when a significant portion of the supply is not in profit and the price is under consolidation.
The percentage supply in profit for Ethereum has been falling since facing rejection from $4k in December. This metric is currently lower than at any point since October 2023, causing frustration for holders as Bitcoin trades near $100k. The short-term holder net unrealized profit/loss (NUPL) is currently at -0.164, indicating that STHs are at a loss for transactions younger than 155 days.
When considering the range formation and negative STH NUPL, it appears that this could be a good buying opportunity for Ethereum. However, historical data shows that negative NUPL does not always indicate a local bottom. For example, in January 2022, the STH NUPL was at -0.018 and dropped to -0.4 in February, leading to a significant price plunge in June. Therefore, contextually using metrics and price action suggests that ETH’s price could potentially drop towards $2.1k.
