What you need to know before investing in Ethereum

Ethereum struggled to make a name for itself this month. For the most part, price action has been fairly flat this month and the altcoin king is struggling to break the $ 3,600 mark.

This has resulted in some investors repeating their bearish behavior, which may not be best in a high growth market. This is what you should pay attention to now before investing in Ethereum

Which part of the Ethereum investors did what?

Usually, large wallet holders (addresses with 1k to 10k ETH), be they individual investors, whales or institutional investors, are known to trigger the investment drive for the rest of the investors. When they buy, others buy; when they sell, others sell.

Apart from the last 2 months, their behavior has been quite different. These large wallet holders buy during a falling market and sell at the first sign of profit.

They first did this in August when they sold their holdings when ETH was up 51.21%. Then came September when, along with other alts, the second generation coin fell 21.69% when they were repurchased.

And now that Ethereum is up 20% in October, they’re selling again. The same can be seen in the price movement and RSI shown in the chart below.

Ethereum holder | Source: Glassnode – AMBCrypto

Collectively, these owners caused outflows worth approximately $ 267.8 million within a few days.

Surprisingly, however, smaller investors have not followed her advice. Their numbers have increased cautiously and addresses with 10 to 1k ETH are countering the sale of larger holders.

And their decision could even turn out to be very profitable for them.

Profitable how?

Well, this month’s surge has removed Ethereum only 14.2% from its all-time high of $ 4,179. Well, while it wasn’t quite there, investor profitability was already there. Over 87% of all addresses were profitable at the time of writing.

Ethereum profitability | Source: Intotheblock – AMBCrypto

Now, most of you are looking at Ethereum as a solid investment opportunity. Before doing this, however, you need to be aware of the high volatility of the market.

The good thing, however, is that Ethereum was neither overbought nor oversold. The RSI in the bullish neutral zone indicated that optimism for the asset has been strong and a rise in price could take place if conditions are favorable.

Price movement and RSI | Source: TradingView – AMBCrypto

Still, as always, DYOR and invest with caution.

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