Buy the Dip on ETH, or Is More Downside Ahead? These Metrics Give Hints
According to analysts, traders are rushing into Ethereum too early before a broader market panic fully develops. Ethereum (ETH) dropped below the $2,000 level for the first time in nearly two months, a situation that pushed traders back into “buy the dip” mode according to blockchain analytics firm Santiment. However, Santiment pointed out that the sudden wave of optimism around ETHs decline could be a warning sign in itself. Crowd Optimism Points to More Downside Santiments reasoning is that when a major token drops through a key psychological level, traders often split into two camps, with one group panicking and writing off the asset and the other piling in even more because they believe they are catching a discount. Per the firms analysis, the second scenario is what is happening currently with Ethereum. “Retail has erupted with ‘buy the dip’ calls toward $ETH,” it wrote on X, adding that this kind of crowd optimism at a local bottom usually means the price still has some more falling to do. That‘s because, in Santiment’s assessment, retail crowds tend to get such calls wrong and get too optimistic, and anyone buying before panic fully sets in will be doing so before the actual floor arrives. As such, the firm advised