The selling pressure on Ethereum continues, with a significant drop of over 30% from its March 2024 highs. Recent price declines below $3,000 and increased selling activity indicate a challenging time for hopeful buyers in the near future.
Analyst Anticipates Further Decline to $2,700
One analyst suggests that Ethereum remains bearish and is currently trading within a falling wedge pattern. The prediction is for ETH to fall below immediate support levels, potentially dropping to $2,700 in a final “washout” move. Despite market concerns, the overall Ethereum price structure remains unchanged.
Looking at the daily candlestick chart, Ethereum is in a bearish breakout formation following substantial losses in mid-April. Unless there is a strong push above $3,300 and the descending wedge, sellers are likely to exert more pressure. Ethereum currently finds support around $2,800. If the predicted “washout” occurs, ETH could drop below $2,700 towards $2,600 and $2,200, marking key support levels.
Challenges for Spot Ethereum ETFs
The possibility of the United States Securities and Exchange Commission (SEC) rejecting spot Ethereum exchange-traded funds (ETFs) this month adds to the bearish sentiment. Speculation arises from concerns about Ethereum being classified as a security by the commission, potentially hindering ETF approval.
A finance lawyer on X confirmed that the SEC is evaluating the classification of ETH as a security for spot ETF decisions. Unlike Bitcoin, ETH faces additional scrutiny. If ETH is deemed a security, all spot ETF applications could be declined, impacting entities like Grayscale’s Ethereum trusts as the SEC may require liquidation and closure.
In response, Consensys, led by Ethereum co-founder Joseph Lubin, has taken steps to protect the crypto ecosystem by challenging the SEC’s potential classification of ETH as a security. The threat of this classification could have adverse effects on the use of Ethereum and similar blockchain technologies in the United States.
