Ethereum Faces Challenges in Reaching $3,000 Amidst Rising Selling Pressure and Market Trends

Even with the growing excitement around Ethereum (ETH) this month, it looks like the cryptocurrency might have a tough time reaching the $3,000 mark. This prediction is at odds with what many investors expected, especially after the buzz surrounding “Uptober” at the end of last month.

From both on-chain data and technical analysis, we can see three main challenges that could keep Ethereum’s price below $3,000 in the near future.

First, let’s talk about selling activity. One key indicator is the Coinbase Premium Gap, which measures how U.S. investors are behaving. When this gap is high, it shows buying pressure. But when it’s low, it indicates selling pressure. On September 27, the gap was at 0.94, which lined up with ETH’s price climbing to $2,694.

However, as of now, the gap has dropped to -1.41. This change means that many market participants are choosing to sell ETH instead of buying. This trend suggests that we might not see a significant price increase anytime soon.

Next, let’s look at some numbers from Glassnode. They show a big rise in the amount of ETH flowing into exchanges. On October 6, the total inflow was 78,127 ETH. Now, it has jumped to 268,956 ETH. That’s a threefold increase in just five days! This spike suggests that some holders are losing faith in Ethereum’s short-term future and are selling off their assets before prices potentially drop further. It also points to a broader trend where more ETH holders, not just those in the U.S., are offloading their coins. If this keeps up, Ethereum’s price could face serious downward pressure.

Now, let’s take a look at the 4-hour chart. Currently, Ethereum is trading at $2,468 and has been moving within an ascending triangle pattern since July. While this pattern can hint at either a bullish or bearish outcome, the chart leans more towards a possible drop below the triangle rather than a breakout above it.

Given Ethereum’s current weaknesses, it might drop to $2,208 instead of climbing above $2,600. But if buying pressure picks up, this could change. For that to happen, demand for ETH needs to come from various regions, not just the U.S. If that occurs, Ethereum’s first target could be $2,709, with a chance to climb above $3,000 afterward.