Ethereum (ETH) has entered a challenging phase, dropping below its $3,500 psychological support level as Bitcoin (BTC) continues its slide.
With Bitcoin falling under $96,000 and the broader crypto market turning red, Ethereum finds itself testing critical support at $3,400. Can it hold, or will the sell-off push prices closer to $3,000?
Let’s unpack the current trends and what they mean for Ethereum investors.
Analysis
Ethereum’s price has fallen 12.44% over the past week, mirroring the broader market correction. The daily chart shows three consecutive bearish candles, signaling sustained selling pressure.
The decline started after ETH was rejected at $4,100, forming a triple black crow pattern, a strong bearish indicator.
Currently, Ethereum has dipped below the 50-day EMA and is testing the $3,400 support, with its price hovering around $3,404. Other key indicators include:
- Fibonacci Levels: Ethereum has hit the 78.60% Fibonacci retracement level at $3,553, emphasizing the steep nature of this correction.
- RSI Trends: The daily RSI has dipped below the halfway mark and is nearing oversold territory, reflecting increased bearish momentum.
- Momentum Indicators: Selling pressure is intensifying, pointing to a potential breach of current support levels.
If the decline continues, the $3,035 support (aligned with the 200 EMA) becomes the critical psychological and technical level to watch. Below this, the 50% Fibonacci level at $2,942 could act as a fallback support zone.
ETF Impact
Ethereum ETFs are mirroring the market’s bearish sentiment, with massive outflows of $60.47 million in a single session. Leading the sell-off, Grayscale sold $58.13 million worth of Ethereum, signaling a pause in institutional bullishness.
The ETF market, which had previously supported price recovery, is now contributing to selling pressure.
Whale Activity
Ethereum’s volatility is drawing significant activity from whales. While some are buying ETH at discounted prices, others are selling off large holdings to manage debt obligations. Recent whale movements include:
- A whale depositing 22,746 ETH tokens ($77.7 million) to Binance.
- Another whale sending 31,968 ETH tokens ($122 million) for liquidation.
- A massive 49,910 ETH deposit ($170 million) that will likely convert to stablecoins.
This wave of whale transactions highlights the conflicting market sentiment, with some players betting on a recovery and others preparing for further declines.
Will ETH Drop to $3,000?
Ethereum’s ability to hold the $3,400 support level depends on broader market conditions. If selling pressure continues, the next key level to watch is $3,035, where the 200 EMA provides strong support.
However, a breach below this level could push prices toward $2,942, the 50% Fibonacci level, signaling a deeper correction.
On the flip side, a recovery above $3,530 (the 78.60% Fibonacci level) could reignite bullish momentum, provided the broader crypto market stabilizes. For now, Ethereum remains vulnerable to further downside.
