RSI above 70 suggests Ethereum might be overbought and could experience a price correction. When MACD crosses above its signal line, it’s typically a bullish signal, indicating potential for price growth. Together, these indicators provide useful insights for traders.
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Liquidity pools are collections of funds locked in smart contracts on decentralized exchanges (DEXs) that facilitate trades without the need for a traditional order book. Users contribute to liquidity pools by depositing pairs of tokens, earning a share of transaction fees in return. These pools help maintain liquidity, ensuring that trades can be executed quickly and at market prices, even during periods of high demand. Liquidity pools enable DEXs to operate in a decentralized manner, allowing anyone to trade directly from their wallets without relying on centralized intermediaries. However, impermanent loss—where liquidity providers can lose value due to price fluctuations—remains a risk for those participating in these pools.
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Market sentiment plays a key role in driving volatility in the crypto market. News events—such as regulatory updates, major exchange listings, or security breaches—can quickly shift investor mood. Positive sentiment tends to fuel price rallies, while negative sentiment can trigger rapid sell-offs. Social media amplifies this, with influencers and communities sparking hype or fear. Since crypto is still largely driven by retail investors, sentiment shifts can result in sharp, unpredictable price movements, making it crucial for traders to stay tuned to the latest news and trends.
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