Ethereum was named the most actively developed crypto project, the price remains below the key trend line

• Ethereum is the most actively developed crypto project, according to Santiment data.
• The concentration of ETH in a few wallets isn’t bearish, but it does signal high-stakes activity.
• Ethereum has broken below a key trend line that suggests its price could drop to $2,000.

Ethereum (ETH) fell 0.5% on Friday, following recent data showing it is the most actively developed crypto project. ETH also ranks among the first centralized cryptocurrencies by concentration of supply.

Daily Market Reasons: ETH ETF Exits, DevActivity High, Stakes Raised

Ethereum ranks first among crypto projects in terms of development activity, according to Santiment data. While developer activity fell 0.6% in the past month, its DevActivity events topped 180,000.

The number two project with the highest DevActivity, BNB Chain, is far behind with only 90.1K events. High DevActivity within a project often translates into the growth of its technology, which could have a positive impact on the price.

Top crypto projects by developer activity

Santiment data also places Ethereum in fifth place among the top centralized cryptocurrencies. Centralization here refers to the mining power concentrated among a few interested parties or the majority of a coin’s supply that resides in a few wallets.

In the case of Ethereum, Santiment data shows that 44% of its supply resides in ten key wallets. While the centralization of tokens in a few wallets is often interpreted as a bearish signal, Ethereum can be considered bullish. Most of its large holders are staking platforms that allow investors to contribute to Mainnet security and earn returns in return, as Santiment noted. High-stakes activity also reduces ETH supply pressure and can cause price spikes during periods of high demand.

Meanwhile, Ethereum exchange-traded funds (ETFs) returned to negative flows on Thursday after seeing $1.7 million in outflows. Flows were limited to Grayscale’s ETHE and ETH Mini Trust as other issuers saw neither outflows nor inflows.

In other news, Ethereum co-founder Vitalik Buterin saw his ETH holdings go from 325,000 ETH three years ago to 240,000 ETH worth $592 million as of Friday, according to Lookonchain data.

ETH Technical Analysis: Ethereum Drops Below Key Trendline

Ethereum is trading around $2,510 on Friday, down 0.5% on the day. ETH’s 24-hour liquidation is $43.8 million, with long and short liquidations accounting for $34 million and $9.82 million.

ETH Open Interest (OI) has decreased by 5% in the last 24 hours and is currently at $10.39 billion. Open interest is the total value of outstanding positions in a derivatives market.

Only six days have seen a drop in OI since May 5. The falling OI shows that traders are more cautious, especially after the August 5 crash wiped out several long positions.

ETH Exchange Open Interest

On the daily chart, ETH has broken below a key downtrend line extending from May 27th to September 30th. The trendline suggests that ETH could drop into the $2,000-$2,300 range before staging a rally.

ETH saw similar declines from August to November 2022 and from July to October 2023 before eventually rallying on both occasions. If ETH repeats the same pattern, it could stage a massive rally. On the way up, ETH is facing resistance around the horizontal line at $2,817. A successful move above this level could see ETH approach resistance at $3,542.

ETH/USDT Daily Chart

Meanwhile, ETH is still trading in a key symmetry triangle extending from November 2021. If ETH breaks above the upper descending trendline of the symmetry triangle, it could set a new all-time high.

The Awesome Oscillator (AO) displays consecutive rising red bars below the zero line, indicating dominant bearish momentum. The Relative Strength Index (RSI) is at 36 and is falling, which means bearish momentum is prevailing.

A daily candlestick close below support around $2,111 will invalidate the thesis.