Ethereum Price at Risk of "Falling 🔪 knife
Ethereum's current trend sparks concerns about a "falling knife" situation, where buying an asset in a declining phase can lead to further losses.
The "Falling Knife" Risk
The "falling knife" concept warns against buying an asset whose price is dropping, as it may continue to fall. While purchasing at low prices can be convenient, identifying the bottom is crucial.
Ethereum's Bottom
A data point suggests Ethereum's bottom might be near, with its price in Bitcoin (ETH/BTC) at 0.022 BTC, the lowest since mid-2020. However, this bottom refers to ETH/BTC, not ETH/USD.
Challenges Ahead
Ethereum's price has struggled since December, losing over 50% of its market value. The current levels are low, but the situation remains critical.
Bitcoin's Influence
Bitcoin's trend will be crucial in the coming months. If BTC drops below $70,000, Ethereum's price might struggle to hold $1,800.
Conclusion
Buying Ethereum now carries a "falling knife" risk. While some indicators suggest a potential bottom, the situation remains uncertain. The coming months will be crucial in determining Ethereum's future price.