Ethereum Holds at $2,500 Amid Volatility

On Tuesday, the price of Ethereum hovered around $2,520 due to ongoing selling from recent buyers and long-term holders. As the price approached the key resistance level of $2,500, signs of overheating began to appear in the market. Trading volume surged, primarily driven by profit-taking, leading to increased volatility and a brief spike in futures liquidation.

The average coin age (a metric that measures the time ETH stays in wallets) has decreased, reflecting a trend of investors continuously selling their tokens. Recent futures data charts show that trading activity has increased over the past day, with a higher number of liquidation orders, resulting in $71.83 million worth of assets being liquidated.

Despite these pressures, Ethereum's price remains stable. The buying volume from whales and institutional investors is comparable to that of small holders. Notably, BTCS, listed on Nasdaq, disclosed that it has purchased 3,450 ETH, while Abraxas Capital has increased its holdings to over 350,000 ETH since early May. On-chain data indicates that despite recent profit-taking by retail investors, these trades have helped stabilize the price.

Correlation of Risk Assets at Low Levels

Recent chart data shows that the RTY/SPX (comparison of high-risk stocks to the U.S. market), copper/gold, and Ethereum/Bitcoin trading pairs are all at long-term support levels. These areas previously signaled volatility during trend reversals or accelerations. The fact that multiple assets are reaching this level suggests that the overall economy is impacting the market.

Market analysts, including ShayanMarkets from CryptoQuant, believe there is a significant amount of historical buying activity around these areas. Additionally, data from IntotheBlock indicates that during this period, ETH purchases exceeded 70 million, suggesting strong market interest in maintaining upward price momentum. If prices fall below these levels, investors may react to unrealized losses, triggering greater volatility.

Currently, the RTY/SPX ratio has reached levels seen in 2020 when there were significant changes in market risk. The copper/gold ratio, which tracks the difference between cyclical and defensive assets, is near its lowest level in years. The trading price of Ethereum/Bitcoin is at the bottom of a multi-year range, indicating that Ethereum is underperforming compared to other cryptocurrencies.