Ethereum (ETH) faces a critical juncture as the cryptocurrency risks dropping to 17-month lows near $1,550, according to leading analysts. The second-largest cryptocurrency has already declined 17% over the past month, with technical indicators suggesting further downside potential if key resistance levels aren’t reclaimed soon.
Technical Analysis Points to Bearish Scenario
ETH has been trading below a crucial support zone between $1,750-$1,840 after failing to maintain the psychologically important $1,900 level. This price action follows a broader breakdown that saw Ethereum lose its 15-month trading range in early March, when it fell below $2,100 for the first time since December 2023.
Notably, large Ethereum holders have been actively accumulating during this dip, suggesting some institutional confidence despite the bearish technical setup.
Key Price Levels to Watch
According to analyst Rekt Capital, Ethereum’s current price action has validated a double top formation within the $2,196-$3,904 macro range. The cryptocurrency now trades within a historical liquidity pool between $1,640-$1,930, setting up for a potential bearish retest of the range’s top.
ETH Dominance Shows Signs of Reversal
Despite the bearish technical setup, there are some positive signals. ETH’s market dominance has dropped from 20% to 8% since June 2023, historically a reversal zone for the cryptocurrency. Previous touches of the 7.5%-8.25% dominance range have preceded significant recoveries.
Potential 20% Rally Scenario
Some analysts remain optimistic about ETH’s short-term prospects. AltCryptoGems analyst Sjuul has identified a Power of 3 setup on lower timeframes that could trigger a 20% rally if ETH breaks above key resistance levels. The potential rally would target the $2,150 resistance level.
FAQ Section
What is the current key support level for Ethereum?
The critical support level sits at $1,750, with the next major support at $1,550 if current levels fail to hold.
Could Ethereum still rally in the near term?
Yes, analysts suggest a potential 20% rally is possible if ETH breaks above $1,930 and reclaims the $2,100 resistance level.
What’s causing Ethereum’s current price weakness?
The weakness stems from a combination of technical factors, including the breakdown of a 15-month trading range and consecutive negative monthly closes.
As of this writing, ETH trades at $1,808, showing a modest 2.2% gain in the daily timeframe. Traders should closely monitor the $1,930 resistance and $1,750 support levels for potential breakout or breakdown scenarios.