Cryptocurrencies took a major hit in the crash that began last October. While Bitcoin and altcoins experienced a decline, the risk is not over for Ethereum (ETH).
A CryptoQuant analyst warned investors, noting that the ETH premium on Coinbase has fallen to its lowest level in 10 months.
According to CryptoQuant analyst CryptoOnchain, Ethereum (ETH) is showing bearish signals.
At this point, the analyst noted that the Coinbase premium for ETH had fallen to its lowest level in 10 months, indicating weakening demand from US-based investors and stronger selling pressure on Coinbase compared to Binance.
Coinbase also noted that the drop in ETH premium to its lowest level in 10 months poses a significant obstacle to ETH price regaining the $3,300 level.
“The sharp drop in the Ethereum Coinbase Premium Difference into negative territory indicates weakening demand from US institutional investors, posing a significant obstacle to the price regaining the $3,300 level.”
The analyst noted that ETH has been in a downtrend since $4,700 and has failed to break through the key resistance level of $3,300, adding that low demand for spot ETH ETFs also triggered the decline.
The analyst noted that historically sustainable Ethereum rallies have been accompanied by a positive Coinbase Premium, where prices on Coinbase trade higher than those on Binance.
The current negative read indicates that US-based institutional investors are not actively accumulating ETH at current price levels. Consequently, the analyst stated that a breakout above $3,300 is unlikely until the price difference between Coinbase and Binance turns positive and real demand re-emerges in the US spot market.
The analyst warned investors that if this negative trend in Coinbase ETH premium continues, there is a risk of further downward correction.
*This is not investment advice.
