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Analysts say that as rumors of a "huge short positions trap" circulate in the market, Ethereum (ETH) has already shown buy signals.
The price of Ethereum has dropped more than an analyst expected, but he stated that it is still an "excellent area" to accumulate the asset. Ethereum may have entered a major accumulation range, and analysts suggest that the recent pullback could soon reverse. Michael van de Poppe, founder of MN Trading Capital, stated in a post on X on Thursday that the recent price drop of Ethereum (ETH) is "slightly deeper than expected." "It's still a good area to accumulate ETH positions," he added. Ethereum traders are aiming for $5,000 by the end of the year. According to CoinMarketCap, Ethereum has dropped 13.61% in the past week, falling to a low of $3,099 on Tuesday before rebounding to $3,337 at the time of publication. Pseudonymous cryptocurrency trader Ash Crypto stated that the price of ETH "looks like a massive bearish trap" and hopes that the token will reach $5,000 by the end of the year.
Ethereum has fallen 24.32% in the past seven days. Source: CoinMarketCap
Since 2013, November has been the best performing month for Bitcoin, but according to CoinGlass, the average return rate for Ethereum during the same period has been relatively weak, at only 5.76%. Just a month ago, on October 7, Ethereum's trading price was close to $4740. Some market participants expect the token to return to that price level soon. "You are about to witness one of the greatest reversals we've seen on ETH," cryptocurrency trader Gordon said.
Other traders have stated that "supply tightening" may lead to price increases, pointing out that the reduced supply of Ether on cryptocurrency exchanges is a strong driving factor.
Ethereum sentiment turns bullish
As Ethereum traders become more optimistic on social media, despite the overall fear in the broader decline of the crypto market, the price of the token saw a slight increase on Thursday. After Ethereum nearly reached $3500 on Thursday, the rise in bullish comments on social media triggered traders to view it as a positive signal of the token returning to form, according to market intelligence platform Santiment in a post on X.
The Crypto Fear and Greed Index, which measures the overall sentiment of the crypto market, released a score of 24 out of 100, indicating "Extreme Fear" on Friday.