As a researcher with experience in cryptocurrency market analysis, I believe that the recent downturn in Ethereum’s price is a result of both market sentiment ahead of the FOMC meeting and profit-taking following the previous bullish run. The invalidation of the bull flag pattern on the 4-hour chart is concerning, but Ethereum’s daily chart still shows the price above key moving averages, providing some support.
The cost of Ethereum has dropped below its previous consolidation range, signaling a reversal from the earlier bullish trend indicated by the flag. Concurrently, investors are on edge as they anticipate the FOMC meeting scheduled for Wednesday, which could potentially lead to reduced interest rates or a rise in them.
As a researcher, I’ve examined the cryptocurrency market trends and found that Ethereum was priced at $3,549 during European business hours on Tuesday. This represents a 3.7% decrease in the preceding 24 hours and an additional decline of 5.9% over the past week, according to data from CoinGecko.
ETH/USD Price Analysis: Bears Take Hold of the Market, These Are the Support Levels to Watch
The Ethereum price had been moving within a consolidation range, which was a component of a larger bull flag formation. Bull flags signify bullish market trends as investors anticipate the pattern to continue upward. However, unexpectedly intense downward pressure occurred during the early hours of June 11, causing a significant drop in Ethereum’s price.
Ethereum’s price dipped below its 4-hour range, signaling that the bull flag formation may no longer be valid. However, on the daily chart, Ethereum’s price continues to hover above both the 50-day and 200-day simple moving averages, although it’s getting quite close to these key levels.
As a researcher studying the behavior of bears in the Ethereum market, I’ve identified a potential scenario where their persistent selling pressure could cause the ETH price to decrease. If this trend continues, the Ethereum price may find support around the 50-day Simple Moving Average (SMA), which happens to align with the 0.5 Fibonacci retracement level. This would place the ETH price approximately at $3,400.
From a research perspective, if the buying pressure outweighs the selling pressure in the Ethereum market, the ETH price could surge and touch the lower boundary of its range near $3,650. If this trend continues, Ethereum may retrace its steps and trade within the range between $3,700 and $3,950 before potentially breaking above and targeting $4,200. Currently, $3,650 serves as a significant resistance level for Ethereum price movements.
Why is the Ethereum Price Crashing?
Yesterday, Ethereum’s price decreased prior to the Federal Open Market Committee (FOMC) meeting, and this decline mirrored Bitcoin‘s price drop. The cryptocurrency community suspects that the market turmoil is linked to the FOMC’s upcoming decision.
Anticipation runs high among the Federal Open Market Committee (FOMC) and Producer Price Index (PPI) communities as they await the outcomes on Wednesday and Thursday, respectively. I believe a significant market reaction is imminent following these announcements in the Bitcoin and altcoin sectors.
— ₿ SatMaxx ₿ (@vinee202) June 11, 2024
Market analysts at Bankrate predict that the Federal Open Market Committee (FOMC) will maintain current interest rates at their highest level in the last 23 years during their upcoming session. Nevertheless, these experts anticipate that only three or fewer rate decreases will occur before the year 2024 concludes.
Currently, Ethereum’s core elements are robust. Notably, its mainnet outperforms Layer 2 solutions when it comes to transaction fees. Specifically, it generates approximately twenty times more revenue from fees compared to the leading Layer 2 platforms working together.
Bottom Line
Investors should keep a close eye on the coming days, particularly Wednesday and Thursday, as the release of FOMC and PPI data could significantly impact Ethereum prices and the broader market trends. If the FOMC announcement and subsequent comments prove unfavorable to the markets, Ethereum’s robust fundamentals might help maintain its price.
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2024-06-11 08:41