Last week, the Ethereum network experienced an increase in activity, with a significant increase in daily active addresses and new accounts.
However, despite the increase in network activity, the ETH price is facing selling pressure, and traders continue to dispose of altcoins, raising concerns about the short-term outlook.
Increased Ethereum user activity, but there are issues
Over the past week, user activity on the Ethereum network has surged. According to data from Artemis, the daily number of unique addresses that completed at least one transaction on the layer-1 blockchain increased by 21% last week. During that period, the number of unique Ethereum addresses was 362,000.
As expected, the increase in Ethereum users led to an 8% surge in the daily transaction volume completed on the network.
Read more: How to Invest in an Ethereum ETFEthereum network activity. Source: Artemis
Generally, an increase in Ethereum's daily active addresses and transaction count is considered a positive indicator for the price. However, if the overall market sentiment is neutral or bearish, the price response may be delayed. This is the case for ETH, as the price response has been muted despite the increase in network activity.
The negative Chaikin Money Flow (CMF) for ETH clearly demonstrates this. This indicator measures the flow of money into and out of the asset market, and it is currently at -0.11, below the zero line.
The negative CMF indicates that the asset has experienced more selling than buying. This signals that more traders are selling the asset rather than accumulating it.
Ethereum CMF. Source: TradingView
ETH Price Forecast: What Traders Should Watch Out For
ETH is currently trading at $2,465. The price of Ethereum could immediately drop to the support level of $2,353 if selling activity intensifies. However, if this price level is not defended, the value of ETH could further decline to $2,111.
Read more: Ethereum (ETH) Price Prediction 2024/2025/2030Ethereum price analysis. Source: TradingView
On the other hand, this bearish outlook would be invalidated if new demand surges. This would drive the price up to $3,102, the level last reached in August.
Disclaimer: The content above is only the author's opinion which does not represent any position of Followin, and is not intended as, and shall not be understood or construed as, investment advice from Followin.
