Ethereum Price Faces Volatility Amidst Macro Headwinds
The Ethereum price recently experienced a 3.28% overnight drop, struggling against selling pressure. The breach of the crucial $4,500 support level triggered stop-loss orders, leading to a cascade of liquidations. This increased market volatility was fueled by macroeconomic factors such as a stronger U.S. dollar and uncertainty surrounding Federal Reserve policy. Additionally, traders shifted their focus towards BNB Chain, attracted by lower fees and increased on-chain activity.
On-Chain Signals: ETF Flows & Liquidations
Recent data on ETF flows and liquidations highlight the heightened volatility in Ethereum’s derivatives market. The asset failed to reclaim its 7-day SMA at $4,524 and dropped below the Fibonacci 23.6% retracement level at $4,542. This led to over $109.6 million in long position liquidations within a 24-hour period. ETF inflows have slowed down, signaling cautious institutional sentiment and a decline in market cap to $523.56 billion.
ETH Price Analysis
The recent selloff in Ethereum has invalidated multiple technical support levels, with the asset trading near $4,337.51, down 3.4% for the day and 1.12% for the week. The price is consolidating near the key breakdown area, with immediate support at $4,308.81. A deeper downside risk towards $4,101.88 is possible if bearish momentum persists. The RSI indicator leans towards bearish territory, suggesting the potential for further selling pressure. Unless ETH regains critical averages, retests of monthly lows and a broader crypto correction could occur.
FAQs
1. Is Ethereum a good investment right now?
Given the recent breakdown below $4,500, Ethereum faces short-term risk, but long-term prospects depend on fundamentals.
2. Is Ethereum a good buy after this drop?
Buying after sharp corrections carries risk, as Ethereum could see further downside if market sentiment remains bearish.
3. What is the Ethereum price prediction for 2025?
If bullish trends and ETF momentum return, the Ethereum price could reach a maximum of $9,428.11 by the end of 2025.
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