Ethereum might be bottoming out on the market as profitability of the asset dips below 70%
According to the latest data provided by InTheBlockEthereum could bottom out, depending on the rate of return.
As the profitability rate suggests, around 70% of Ethereum investors are holding the asset at a profit, which is considered a relatively high rate and does not reach the extreme levels we saw back in 2021, when Bitcoin and Ethereum profitability was close to 90%.
Usually it is possible to determine local lows and highs by comparing price action with different rates of return. Usually profitability consolidates around 90%, 70% and 50%. Anything below these rates usually moves erratically.
Ethereum’s 70% profitability also correlates with the local support of $3,000, which is often considered psychological support for investors. Unfortunately, the most recent price action of Ethereum suggests that it continues dropping further as it lost 7% of its value only a couple days ago.
If we compare the evolution of Ethereum’s profitability to the daily trading chart, the majority of ETH investors most likely opened their positions in the $2,500-$3,000 range. The second largest cryptocurrency in the market was trading in the range in August and June during the first bull cycles in the crypto market.
At press time, Ethereum is trading at $2,900 and holding the selling pressure right at the newly formed trendline support which has not been tested yet.
