Ethereum (ETH) Faces Potential Drop to $3.4K Despite ETF Optimism – Key Factors Explained

• Ethereum price dips despite Spot ETF approval by the U.S. SEC.
• A crypto market analyst predicts that the Ether price could dip to around $3.4K.
• TD Sequential indicator shows a sell signal on Ethereum’s daily chart.

Ethereum price faces potential decline despite recent ETF approval, with analysts predicting a dip to $3.4K amid bearish signals.

Analyst Unveils Potential ETH Movements

Prominent crypto market expert, Ali Martinez, recently examined Ethereum’s market movements and provided some insights. He noted that substantial transfers of ETH to exchanges are raising eyebrows. This activity has spurred speculation about potential profit-taking, portfolio rebalancing, or mere market speculation.

Significant Transfers to Exchanges

Adding to the concern, Ethereum co-founder Jeffrey Wilke recently transferred 10,000 ETH, worth approximately $37.38 million, to the Kraken exchange. This significant transfer could indicate a potential sell-off, which might trigger price volatility. According to Spot On Chain data, Wilke’s move is part of a broader trend where over 242,000 ETH have been transferred to exchange wallets in the past two weeks. Notably, it also adds to the spike in Ethereum trading activity in recent days.

Meanwhile, Martinez also pointed out that the TD Sequential indicator is flashing a sell signal on Ethereum’s daily chart. This indicator, known for predicting market trends, suggests that ETH might face selling pressure. He said that the green nine candlestick on the daily chart could lead to a price retracement or even a new downward phase before any potential uptrend resumes.

Key Ethereum Price Levels

According to IntoTheBlock data, a significant number of Ethereum addresses could provide crucial support if the price dips further. Around 1.81 million addresses bought about 1.66 million ETH between $3,820 and $3,700. The analyst suggests that this range could act as a buffer against increasing selling pressure. However, if Ethereum’s price falls below this zone, the next support level lies between $3,580 and $3,462. Notably, in this range, 3.13 million addresses were acquired over 1.50 million ETH.

On the other hand, the critical resistance barrier for Ethereum stands between $3,940 and $4,054. More than 1.16 million addresses previously purchased around 574,660 ETH in this range. If Ethereum can surpass this resistance and close above $4,170, it could invalidate the bearish outlook and potentially initiate a new upward trend toward $5,000.

Conclusion

While the recent approval of the Ether ETF by the U.S. SEC is a positive development, Ethereum’s price faces potential short-term declines due to significant transfers to exchanges and bearish technical indicators. Investors should closely monitor key support and resistance levels to navigate the potential volatility. In the long run, the Ether ETF could propel an Ethereum price rally, similar to Bitcoin’s performance following its ETF approval. However, caution is advised in the short term as market dynamics play out.