- Ethereum’s bearish market structure suggests a possible drop to $2.5k.
- Increased selling pressure is indicated by the OBV slipping below a key level.
- Ethereum’s bearish trend was reinforced by the potential rejection of spot Ethereum exchange-traded funds (ETFs) applications in the U.S.
Ethereum’s bearish market structure and potential ETF rejection in the U.S. could see the cryptocurrency’s price drop to $2.5k.
Ethereum’s Bearish Market Structure
Ethereum [ETH] has been in a bearish trend on the daily timeframe after dropping below the $3k mark six weeks ago. A set of Fibonacci retracement levels were plotted based on ETH’s drop from $4093 to $3056. In mid-April, ETH fell below the $3k mark, swinging the structure bearishly. The OBV also fell below a significant level, indicating increased selling pressure. The Ethereum price prediction shows that a drop below $2.8k is likely, given the Fibonacci extension levels.
Potential ETF Rejection Reinforces Bearish Sentiment
Reports suggest that the spot Ethereum exchange-traded funds (ETFs) applications in the U.S. are likely to face rejection. This would reinforce the bearish sentiment in the market, with analysts projecting far lower prices for Ethereum in the coming months in the event of a rejection. However, it remains unclear how long the downtrend would persist.
Short-Term Bounce Over
Just over 24 hours before the time of writing, the cumulative liq levels were deeply negative, indicating that the short liquidations outnumbered the longs. A few hours later, the price bounced from $2870 to $2990 to take out the late short sellers. At press time, the cumulative liq levels were negative but less extreme, suggesting space for the prices to go further south. The $2840 region is a short-term Ethereum price prediction target.
Conclusion
The bearish market structure of Ethereum, coupled with the potential rejection of spot Ethereum ETFs in the U.S., suggests a possible drop in the cryptocurrency’s price to $2.5k. However, the duration of this downtrend remains uncertain. The short-term bounce appears to be over, with the cumulative liq levels indicating potential for further price drops.
