The crypto market is excited as Ethereum, the second-largest cryptocurrency by market cap, gears up for its highly anticipated Shanghai upgrade. However, as the date for the upgrade approaches, some investors are concerned that the Ethereum price may experience a “sell the news” event. As the hype around the upgrade builds, many investors are buying Ethereum, hoping to cash in on the potential price increase. Some experts warn that the market may be overvaluing Ethereum ahead of the upgrade and that a “sell the news” event may be in the cards.
Ethereum Whales May Play Pump-And-Dump Game
With the Shanghai and Capella upgrades, also called Shapella, scheduled for launch on April 12, the ETH holder community is eagerly anticipating the event. However, despite the recent rally of the altcoin in the lead-up to the upgrade, some experts predict that the Shanghai hard fork may result in a “sell-the-news” scenario for crypto market participants.
According to Santiment, a crypto intelligence tracker, the balances of the largest Ethereum addresses are moving in opposite directions when split into exchange and non-exchange categories. The top ten exchange addresses are seeing an all-time low in Ethereum balances, while non-exchange addresses continue to climb.
This behavior indicates a decrease in selling pressure on crypto exchange platforms. This is a positive sign for the altcoin’s price and indicates a potentially bullish trend. Nonetheless, Ethereum’s price trajectory could mimic the pattern seen during last year’s Merge event, where the asset experienced a substantial surge before encountering a significant increase in selling pressure, resulting in a sharp decline in the token’s value.
What Lies Ahead For Ethereum?
The price of Ethereum surged past the $1,860 resistance zone, outpacing Bitcoin and breaking through the $1,900 resistance zone. However, the price hit a peak of around $1,942 before starting to experience a downward correction.
The $1,900 support zone was breached, leading to a drop in Ethereum’s price. It also fell below the 50% Fib retracement level from the $1,850 swing low to the $1,925 high. Despite this, the bulls came into action and prevented further decline by supporting the price above the $1,853 level.
As of writing, ETH price trades at $1,874, a decline of over 1% in the last 24 hours. Analyzing the hourly price chart, Ethereum is poised for a bearish reversal soon as it may face strong resistance above $1,900. Ethereum may begin a downward correction to the $1.8K level in the next few days. However, a rebound from that price level is expected, and ETH price may surge to $2K ahead of the Shanghai upgrade.