Ethereum (ETH) Price Ends October with Over 7% Decline
Ethereum (ETH) price just concluded October with an over 7% decline from its opening to closing price. This marked a second consecutive month in the red, leaving investors wondering whether a hat trick may be on the cards for the bears in November.
On the daily chart, ETH price confirmed that the bearish momentum experienced in the last week of October had cooled off. Previous bearish retreats gave way to a modest recovery. However, ETH demonstrated limited upside in the last two days of the month. At press time, ETH was trading around $3,846, representing less than a 5% rally from its lowest price point the previous week.
The fact that the bulls did not mount a significant comeback after the recent dip indicates that demand is not quite ready to flood back in. Despite this, there were signs of accumulation along the way. For example, while ETH price declined between October 27 and 30, its Money Flow Indicator (MFI) maintained an upward trajectory. This divergence suggests investors were buying on the way down.
Low Address Activity Explains Subdued Ethereum Price Recovery
Market sentiment closed October in fear territory, reflecting ongoing investor uncertainty despite easing bearish pressure. This uncertainty is evident in address activity within the Ethereum ecosystem.
On-chain data revealed that daily active addresses on Ethereum peaked at around 480,000 in mid-August. However, they declined by over 24% to as low as 364,000 addresses as of October 26. Although ETH active addresses registered a slight uptick towards the end of October, daily activity began to cool down again in the last three days of the month.
This decrease signals weak network activity and subdued demand. In other words, the recent market uncertainty may provide clues on what to watch for if market excitement makes a comeback.
Long-Term Bullish Signs Remain Intact
Despite the short-term challenges, several developments confirm that longer-term bullish optimism remains active. Notably, Ethereum exchange reserves continued their decline, reaching a new 12-month low even during the bearish price action in the last week of October.
This trend is reassuring for ETH holders because shrinking supply on exchanges can make ETH more susceptible to a supply squeeze. It also indicates investor confidence, as exchange outflows are often associated with long-term HODLing.
What to Expect in November
As for November, subdued demand at the start of the month suggests that short-term uncertainty persists. ETH and other top cryptocurrencies may require a catalyst to trigger a positive shift in market sentiment.
That said, weak price movement early in November does not necessarily seal the cryptocurrency’s fate for the month. After all, Ethereum started October on a bullish note but ended the month in the red.
Ethereum’s Dominance and Developer Activity
Beyond price movements, Ethereum remains one of the dominant blockchain ecosystems. Recent data reveals it continues to have the highest developer activity across the blockchain landscape, underscoring its ongoing relevance and potential for growth.
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In summary, while Ethereum’s price faced downward pressure at the end of October and early November, signs of accumulation, shrinking exchange reserves, and robust developer engagement point to a foundation of longer-term bullish optimism amidst short-term market caution.
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