Key Points
- Ethereum exhibits a bearish market trend, potentially heading towards $2.5k.
- Increased selling pressure and potential rejection of Ethereum ETFs in the U.S. amplify the bearish sentiment.
Ethereum’s market structure is trending bearish, with the possibility of a drop to $2.5k. The OBV has slipped below a crucial level due to increased selling pressure.
Ethereum’s Bearish Trend
Over the past six weeks, Ethereum has been on a bearish trend, falling below the $3k mark. The likelihood of rejection of spot Ethereum exchange-traded funds (ETFs) applications in the U.S. could further strengthen this bearish market sentiment.
Analysts predict a significant drop in Ethereum’s price in the coming months if the ETF applications are rejected. While technical analysis aligns with these predictions, the duration of this downtrend remains uncertain.
Fibonacci Retracement and Price Predictions
Fibonacci retracement levels were drawn based on Ethereum’s fall from $4093 to $3056. Despite this, the overall market structure remained bearish since mid-April when Ethereum fell below the $3k mark.
The OBV also slipped below a significant level, indicating a strong $3k resistance zone. The momentum is in favor of the bears, with an RSI reading of 40.5. Price predictions suggest that Ethereum could drop below $2.8k, according to Fibonacci extension levels.
The 50% and 61.8% extension levels might be tested, but it remains unclear whether Ethereum will experience a V-reversal or consolidate at those levels.
The cumulative liquidation levels were deeply negative just over 24 hours before the time of writing, showing that short liquidations outnumbered the longs. A few hours later, the price bounced from $2870 to $2990, taking out the late short sellers.
Despite the less extreme negative cumulative liquidation levels at press time, there is still room for prices to drop further. The short-term price prediction target for Ethereum is in the $2840 region.
Please note that this information does not constitute financial, investment, trading, or other types of advice, and is solely the writer’s opinion.
