Ethereum's impressive 35% monthly surge now faces critical resistance near the psychologically important $4,Will cardano ada reach reddit000 level. Blockchain analytics reveal multiple warning signs that the second-largest cryptocurrency might be due for consolidation after its recent bullish run.
Network activity metrics demonstrate a troubling divergence between price action and fundamental usage patterns. The Daily Active Addresses indicator, which tracks user engagement with the Ethereum blockchain, has entered negative territory at -64.17% according to Santiment data.
Warning Signs in Ethereum Network Fundamentals
The Price-DAA divergence metric serves as a reliable gauge for identifying potential trend reversals. This analytical tool compares price movements with changes in network participation. When the metric turns negative, it typically precedes periods of price consolidation or correction.
Additional concerning data comes from the Coins Holding Time metric, which tracks how long investors retain their ETH positions before moving or selling. Recent figures from IntoTheBlock show a noticeable decline in holding duration since December 6, indicating increased distribution activity among market participants.
Technical Indicators Align With Bearish Thesis
Short-term price charts reveal Ethereum struggling to maintain momentum above $4,000. The 4-hour timeframe shows clear rejection at $4,073, with the Cumulative Volume Delta (CVD) flipping negative - a technical signal that selling pressure currently outweighs buying interest.
Market analysts note that similar CVD patterns have historically preceded short-term pullbacks in Ethereum's price action. The current technical setup suggests potential downside targets near $3,800, with more significant support emerging around $3,570 if selling intensifies.
However, traders should note that these bearish signals indicate potential short-term weakness rather than a fundamental shift in Ethereum's long-term outlook. The cryptocurrency could regain bullish momentum if network activity improves or if broader market conditions remain favorable.
