Is Ethereum’s (ETH) Current Dip a Buying Opportunity or a Trap?

Ethereum (ETH) briefly declined to $3,700 yesterday, sparking panic among ￰0￱ leading altcoin has since recovered, though modestly, before stalling just below $3,900. The wider sentiment remains cautious, but this crowd fear may once again fuel ￰1￱ Bounce Signal Over the past month, Ethereum’s price has shown notable volatility, starting near $4,170 in early October before briefly slipping below $3,800 by month’s ￰2￱ multiple short-lived rebounds, the overall trend remained downward after selling pressure increased ￰3￱ the most recent dip this week, many traders have opened short positions against ￰4￱ previous instances into account, this kind of bearish sentiment often leads to a rebound, according to crypto analytic firm ￰5￱ analyst Galaxy observed that Ethereum is nearing the end of a massive 1,400-day consolidation pattern, often referred to as a “triangle.” His data indicated that ETH has been compressing between long-term support and resistance levels since ￰6￱ such, November could mark the completion of this retest and potentially point to the start of a renewed bull run if the crypto asset successfully breaks out of this formation.

Meanwhile, analyst Michaël van de Poppe said that Ethereum is in a good buying zone as it tests its 20-week moving average and a key support ￰7￱ believes this correction phase won’t last long and could soon lead to a rebound in the asset’s price. Ethereum’s on-chain data also offers a similar cautiously optimistic ￰8￱ to crypto analytics firm Alphractal, while the Buy/Sell Pressure Delta has turned negative and on-chain activity has slowed, these signals do not necessarily point to ￰9￱ patterns in the past have often appeared near the end of correction ￰10￱ explained that the current readings are far milder than those seen earlier this year, which could mean that the market may be in a quiet accumulation phase rather than a ￰11￱ a setup could position Ethereum for the next leg of its growth once sentiment begins to ￰12￱ Pain Ahead?

Ethereum’s path to recovery could still be bumpy. CryptoQuant’s liquidation data, for one, suggest that correction could still deepen, as the market remains dominated by leveraged long ￰13￱ spikes in long liquidations, often triggered by sharp price drops, show traders being forced out of overextended ￰14￱ short squeezes that typically spark quick rebounds, these long-driven liquidations have left prices weak with no strong recovery in ￰15￱ this trend continues alongside falling open interest, Ethereum risks testing levels below $3,400.