Key takeaways
- ETH dropped below the $3,750 mark on Monday as the broader crypto market undergoes a correction.
- It is now trading above $3,800 despite the net outflows.
Ether bounces back above $3,800
Ether, the second-largest cryptocurrency by market cap, lost 3% of its value on Monday and temporarily dropped below $3,750. However, it has recovered nicely and now trades above $3,800 per coin.
The bearish performance comes amid net outflows for the cryptocurrency. According to data from July 29, Ethereum recorded a net outflow of $52.36 million from spot exchanges.
The outflow highlights the growing Ether withdrawals this month as long-term investors take profit. However, the profit-taking hasn’t halted Ether’s performance as the coin looks set to hit the $4k psychological level soon.
Ether continues to see growing volume thanks to the ongoing NFT boom. While speaking to Coinjournal, Evan Kuhn, President of DeLorean Labs, the Web3 division of the DeLorean brand, revealed that legacy NFTs are seeing increased volumes. He stated that,
“Renewed volume around legacy NFT collections like CryptoPunks shows that digital ownership still has speculative appeal, but the more important shift is how NFTs are evolving into infrastructure. We’re seeing a transition from collectibles to utility. NFTs are now being used to manage access, automate rules, and assign roles within on-chain ecosystems.
While Ethereum’s price rebound has contributed to rising volume, the deeper story is about maturation. As NFTs become tools for real utility, they will move from novelty to necessity.”
Ether targets $4k as bulls remain in control
The ETH/USD 4-hour chart is bearish following Ether’s underperformance on Monday. However, the technical indicators on the lower timeframe have switched bullish, suggesting that buyers are regaining control.
The MACD lines have entered the positive region, indicating that the bias has switched bullish. Furthermore, the RSI of 61 shows that ETH could face buying pressure soon. If the recovery continues, Ether could break past the TLQ and resistance at $3,938 and hit the $4k psychological mark.
An extended bullish run would allow ETH to target the $4,200 level for the first time since December. The all-time high price remains $4,891, and it remains Ether’s medium-term target.
However, if the bearish trend returns, ETH could retest the low below $3,500 in the coming hours or days.
