Ethereum Faces Another Drop: Is It in Danger of Falling to $3,100?

Ethereum Faces Another Drop: Is It in Danger of Falling to $3,100?

After a recent attempt to recover, the price of Ethereum has fallen back below the important psychological level of $4,000. Traders are frustrated by the lack of buyers and increasing outflows of Ethereum from ETFs, indicating weak demand and the possibility of further declines.

Key Development Factors:

- ETH price fell to around $3,800 on Tuesday, while attempts to recover from the low of $3,500 on October 11 have stalled around the psychological level of $4,000.

- Technical analysis points to bearish patterns, including a bearish flag, a break of which could lead to a drop to $3,100 - about 20% from the current price.

- Traders warn that the key is whether the price can be sustained above $4,000. If not, it could signal a deeper correction or even the start of a new bearish trend.

Importance of Support and Drawdowns:

- Lack of new buyers is keeping ETH below $4,000, while spot buying volumes on exchanges are still in negative territory.

- Data shows that Ethereum outflows from ETFs are continuing – ETFs have lost over $145 million in the last few days alone, reducing demand for spot Ethereum ETFs.

Outlook and Scenarios:

- If bulls fail to sustain the price above $4,000, a decline to $3,100 is expected based on technical patterns.

- Conversely, if the price manages to break the resistance in the $4,000-4,300 zone, we could see a resumption of the trend towards $5,000.

The markets are still under pressure, and while some analysts see potential for Ether to rise in the long term, the situation is uncertain at the moment. Traders should watch for key levels and volume signals that may indicate whether the trend is reversing or continuing to decline.

*This is not investment advice.

The Coingarage Team