Ethereum (ETH) At a Critical Juncture, Influenced by Various Factors Shaping Its Future Trajectory

As the crypto market rallied, propelled by Bitcoin [BTC] nearing its previous ATH, Ethereum [ETH] enjoyed weekly gains of nearly 10%.

As Bitcoin (BTC) approached its previous all-time high, it propelled the crypto market to new heights. Among the top gainers was Ethereum (ETH), which enjoyed a nearly 10% gain over the past week. At press time, the altcoin was trading at $2.6K.

This price action aligns with a common trading strategy, where high-cap altcoins tend to perform well when BTC encounters a key resistance level, prompting retail investors to shift their capital in an attempt to minimize risk.

However, ETH has shown a different trajectory in the past three days, consolidating in its price as BTC clocked daily gains of over 2% during the same period.

This shift in market dynamics is evident in the price charts. Memecoins have also seen a surge in interest.

Over the past seven days, memecoins surged on the price charts, with three of the top five gainers being meme tokens. Notably, DOGE led the pack with an impressive 30% weekly gain, indicating that investors were seeking higher-risk assets with the potential for quick, outsized returns.

According to AMBCrypto, traders’ increasing interest in memecoins may have contributed to ETH's consolidation on the charts. However, another AMBCrypto report suggested that DOGE's uptick could be a sign of an overheated market that may soon face a correction.

This begs the question – Could a potential pullback attract capital back into ETH, setting the stage for a short squeeze?

According to TradingView, at press time, the MACD lines were approaching a crossover, which if realized, could further bolster ETH's anticipated move over the weekend.

On the other hand, the RSI depicted an overbought condition, with 74% of the price action over the last two weeks trending upwards, hinting at a possible trend reversal soon.

Overall, ETH's technicals appeared to be losing strength with selling pressure as traders continued to ride the memecoin wave. If this trend continues unabated by a shift in momentum, it could lead to a liquidation of long positions, compelling holders to sell.

Such a scenario would hamper ETH's ability to gain momentum when BTC peaks, usually signaling the beginning of altcoin season.

ETH holders eyed the dip as BTC clocked in gains of over 2% daily. However, ETH remained largely unchanged from the previous day with a 0.2% price decrease from the day before that.

Typically, when retail investors sell off their holdings en masse, it signals a market top as they cash in on their gains. Large holders entering an accumulation phase at a local low, on the other hand, can indicate a market bottom, viewing it as a potential dip to buy.

Over the past three days, as ETH's rally stalled, large holders strategically bought ETH at bargain prices, anticipating BTC's rally to continue and more investors seeking refuge in altcoins.

As a result, a large volume of ETH tokens were withdrawn from exchanges, catalyzing a 10% weekly surge despite the prevailing market fear.

Over the past seven days, BTC clocked in gains of over 7% at press time, rallying from the $56K lows to cross the $60K price mark once again. This price action also influenced the altcoin market.

Collectively, the top altcoin price footprints mirrored BTC's trajectory, albeit at varying degrees. While some altcoins clocked in double-digit gains, others, like ETH, clocked in gains of less than 2% over the past three days.

This disparity in price appreciation was largely attributed to the varying rates at which traders shifted their capital into altcoins as BTC encountered a key resistance level.

However, memecoins appeared to be an exception to this trend. Despite BTC's minimal gains, several memecoins managed to clock in double-digit gains over the past three days.

This phenomenon was further supported by the fact that three of the top five gainers in the past seven days were memecoins, with DOGE leading the pack with an impressive 30% gain.

According to an AMBCrypto analysis, this indicated that investors were showing confidence in high-risk assets that offered the potential for quick, outsized returns.

As traders increasingly realized the upside potential in memecoins, interest in ETH waned, leading to its consolidation on the charts. However, another AMBCrypto report suggested that DOGE's uptick could be a sign of an overheated market that may soon face a correction.

Hence, the question – Could this potential pullback attract capital back into ETH, setting the stage for a short squeeze?

At the time of writing, the MACD lines were nearing a crossover. It it turns out as planned, it could further confirm ETH's expected move over the weekend.

On the contrary, the RSI projected an overbought condition, with 74% of the price action over

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