Ethereum prices down following new highs above $4900. Will it crash or not?

Ethereum’s value has fallen by nearly 5% since hitting an all-time record of $4.946.

Crypto.news reports that Ethereum (ETHPrice rallied 21% and reached a record-breaking $4,946 high on August 25. It then settled at $4,713 by the time we went to press. It is still 26% over its August low and 220% higher at this price.

Although the top altcoin in terms of market capital posted strong gains during August, data shows that it could be a bearish month for the coin.

Data from CoinGlass indicates that, since 2016, every time Ethereum posted gains in August it was immediately followed by a decrease in September. ETH recorded gains of 92.86% 25.3% and 35.6% respectively in August 2017, 2020 and 2021. The respective Septembers saw declines of 21,65, 17,08% and 12.55.

This scenario is supported further by the fact ETH continues to be close to all-time levels. Cryptocurrencies tend to experience some selling after reaching a peak as investors book their profits.

Data from CoinGlass indicates that Ethereum’s sudden drop off its high point was caused by an influx of liquidations as positions with excessive leverage were liquidated near the top. In the last 24 hour, ETH liquidations totaled $216 million. Nearly $130 million of that was from positions held long.

As of the date of this publication, there are dense zones for liquidation above $4.900. A new attempt to breach higher levels could trigger another cascade of liquidation. If this occurs, ETH may slip further toward the $4,600–$4,680 range.

Despite the fact that Ethereum is likely to enter the September rally under a completely different macroenvironment. This will be marked by the presence spot Ether ETFs as well corporate treasuries which hold ETH. Both of these were missing during previous rallies in August. 

Ether’s popularity among institutions has led to a $2.79 billion increase in Ether-related inflows for the 9-spot Ether Funds. This is a significant improvement from $5.43billion that was received in the month prior. The Bitcoin funds have experienced outflows of $1.19billion this month.

Ether, one of cryptocurrency’s most popular currencies has contributed to this change in the market. closely watched Crypto assets this month boosted by regulatory momentumWaves of. corporate accumulation.

Ethereum’s daily chart shows that it has traded within an ascending, parallel channel from late June. This channel is marked by higher highs, and higher lows, all within two upsloping trendlines. The structure indicates a continuation in the bullish trend if the price is contained within the channel.

By the time we went to press, Ethereum’s price was just below the midline, indicating a balance between the buying and the selling pressure. The token is still trading above the exponential moving average of 20 days, which indicates that the short-term momentum continues to favor the bulls.

Supertrend has also turned green, positioning itself under the price. Another confirmation of a bullish market.

The Relative Strength Index, however, has fallen to 60. This indicates that the bullish trend continues, without reaching overbought levels. The Relative Strength Index has dropped to a reading of 60, indicating that bullish momentum continues without entering overbought territory.

If the bullish trend continues, then the next big upside target is $5,200. This represents a gain of 10% from the present level, and also marks the upper limit of the channel. Breakouts above this level, especially if they are accompanied by high volume, could lead to further gains.

At $4,349 on the downside, the Fibonacci level of 78.6% retracement is aligned with the latest upward trend.

Breaking below this threshold would invalidate current patterns and trigger deeper corrections towards the lower border of the channel.