Can Ethereum Price Reach $5K Despite Its Worst Q3 Performance in 5 Years?

According to Coinplus data, the Ethereum price prediction has showcased its worst Q3 returns from the last five years. As of press time, Q3 2024 returns are down 33.21%, with the possibility of further declines as there's still over a week left until the end of September.

The cryptocurrency market experienced a slight downturn during Wednesday’s U.S. trading session, with Bitcoin struggling to maintain above $60,000. Meanwhile, the Ethereum price dropped by 1.8%, extending its correction as Q3 nears its end.

Coinplus data reveals that the Ethereum price has recorded its worst Q3 returns over the last five years. As of press time, the Q3 2024 returns stand at -33.21%, with the possibility of further declines as over a week remains until the end of September.

However, the ETH price has managed to sustain itself above $2,000 amid market speculation of a Fed rate cut. Additionally, Ethereum’s historical Q4 performance since 2016 shows a promising period of ETH price bounce, with an average return of 23.39%.

According to a recent analysis by Cryptoquant, Ethereum holders are exhibiting diverging strategies in response to the current market uncertainty.

Large wallet holders with balances exceeding 100k ETH appear to be adopting a stagnant approach, maintaining their positions without significant changes. This strategy could indicate a holding position, anticipating a potential price recovery in the long term.

On the other hand, mid-tier holders with balances ranging from 10k-100k ETH are slowly accumulating, indicating a cautious bullish outlook. This strategy suggests a gradual increase in ETH holdings over time, aiming to capitalize on the market's upswing.

Meanwhile, smaller holders, defined as those with balances between 100 and 1,000 ETH, are slowly selling off their holdings. This trend could be attributed to various factors, including a need for liquidity, a bearish outlook, or a strategy to lock in profits from previous price increases.

This diverging strategy among ETH holders is impacting the market dynamics, influencing the price movements and creating opportunities for traders known as "smart money."

Typically, an exit from the market by short-term holders, such as smaller holders selling their ETH holdings, can lead to price volatility and a temporary dip. This price drop often attracts traders with the capital to buy ETH at a discounted price, aiming to sell later at a higher price to generate profits.

If this theory holds, the Q3 dip could pique renewed buying interest from whales, keeping the potential target of $5,000 within reach.

Four Months of Downtrend: ETH Price 13% Away From Major Support Retest, Can Sellers Break Through?

In the past four months, the Ethereum price has experienced a steady downtrend, decreasing from $3,971 to its current price of $2,278, indicating a 42.67% loss.

The 20 and 50-day Exponential Moving Average, both sloping downwards, showcases that the market sentiment still aligns with a sell-the-bounce strategy.

With sustained selling pressure, the ETH price could drop by 13%, potentially retesting the ascending support trendline that has remained intact since June 2020.

Historically, every reversal from this dynamic support has doubled ETH’s value, signaling a strong accumulation zone. However, if sellers break through the bottom trendline, the Ethereum price could enter a significant correction phase.

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