There is an upturn in crypto market with Bitcoin and Ethereum losing their gains over the last week. Although the general mood in crypto was positive, it could be impacted if major cryptocurrencies drop to their current levels.
Ethereum (ETH) is trading at $1,690, with a 10% loss over the last 7 days and 24 hours, respectively. A critical support area at $1,700 has been maintained by the cryptocurrency. This support was created after major resistance became support.
In a market update, BitMEX Founder Arthur Hayes called the short-term price action across the crypto market “ugly” as he sees potential for further losses. Hayes saidVia Twitter
Unfortunately, the market’s short-term price action can be very negative. It could be that your market reading is wrong if you think you are too long. Do you need to take cover, wait, or do you add? All that matters is your level of nerve and ability to understand the chart.
In the short term, a trader might experience losses, but if the trader is playing the long run on Ethereum, Hayes believes nothing has “fundamentally change” for the second cryptocurrency by market cap. In less than a month, Ethereum is set to deploy “The Merge” on mainnet.
This event will signal ETH’s full transition into a Proof-of-Stake (PoS) blockchain. Ethereum is expected to be the catalyst for an easier-to-use, more accessible, and less energy-intensive crypto market.
In the past, Hayes has said that “The Merge” will be a transcendental event for ETH’s price as the cryptocurrency will manage to attract fresh capital. The BitMEX founder believes that once the blockchain reduces its energy consumption, sidelined money will flow and potentially push ETH’s price higher. Hayes said:
If you tell me the $ETH merge ain’t happening, or something occurred which severely diminishes it’s probability of success then I would be worried about my long position.
It’s Time to Increase Ethereum Holdings
In that sense, traders should keep an eye on “The Merge” and any potential hurdles as they can negatively affect the price of Ethereum. At the time of writing, the update is on track, but ETH’s price must maintain its current levels to prevent further downside.
Analyst Justin Bennet thinks that if bears control the market, the Ethereum price could drop to $300. Bennett said:
An unpopular opinion: It is more likely that $ETH will be $300 or less than $1,000. “That’ll never happen,” they’ll say. In fact, it did in the #crypto bear markets. This was all without any global recession and a bear market in stocks. The inflation rate soared to new heights across many advanced countries.