Key Points:
ETH fell 20% in November, entering a clear daily downtrend, and retested the $3000 level for the first time since July.
The Mayer Multiple indicator has dropped below 1, indicating entry into a historically strong accumulation zone, similar to past bottoming phases.
Leverage liquidity has reset, but the liquidity accumulation zones at $2900 and $2760 warn of potential further volatility before a possible recovery.
Ethereum's native token, Ether (ETH), fell nearly 20% in November, dropping from $3900 to retest the $3000 level on November 17, a price last seen on July 15. Professional analysts point out that this pullback has pushed ETH into a clear daily downtrend, characterized by a series of lower highs and lower lows. Although long-term accumulation signals are beginning to appear, the market remains in a technically weak area.
One of these signals comes from Capriole Investments' Mayer Multiple (MM) index, which measures the ratio of ETH's current price to its 200-day moving average. Market experts explain that a reading below 1 indicates that Ether is trading at a discount relative to its long-term trend, historically consistent with major accumulation zones.
The Mayer Multiple index for ETH has fallen below 1 for the first time since mid-June and has now entered the "buy zone," a region that has historically signaled strong multi-month recoveries.
Industry observers note that throughout ETH's history, readings below 1 typically indicate a long-term bottom, with the main exception being January 2022, when the indicator remained subdued due to the onset of a broader bear market.
Technical analysts believe that the current MM level is more akin to reset conditions of an early cycle rather than the structural collapse seen in 2022, positioning the current market closer to historical buying opportunities rather than distribution or selling zones (which typically occur when MM is greater than 2.4).
Despite the macro accumulation pattern forming, short-term price action remains weak. Data from Hyblock Capital shows that even after ETH broke through the key psychological level of $3000, it remained above several dense long liquidation clusters.
Hyblock notes: "We have swept through quite a few large (bright) long liquidation clusters. The next two clusters below ETH are in the $2904 to $2916 and $2760 to $2772 ranges," suggesting that the market may need a deeper liquidity washout to form a solid bottom.
Additionally, analysis platform Altcoin Vector emphasizes that ETH's overall liquidity structure has "completely reset," a typical state before the formation of every major bottom in history. According to the platform's analysis, liquidity collapses usually signal a multi-week bottoming phase rather than immediately leading to structural collapse.
Altcoin Vector states in its analysis that as long as liquidity is being rebuilt, the pullback window remains open: if liquidity is replenished in the coming weeks, ETH may enter the next expansion phase. However, the longer it takes for liquidity to recover, the longer the consolidation process will be, increasing the structural downside risks ETH faces.
Related: Ether (ETH) falls below $3000, hitting a four-month low: Has the bull market ended?
This article does not constitute any investment advice or recommendation. All investment and trading activities carry risks, and readers should conduct their own research before making decisions.
Original article: “Ether (ETH) Enters 'Buy Zone,' But Volatility-Averse Traders Take a Wait-and-See Approach”
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