Ethereum Price Dips Below $3,400: Will $3,035 Support Hold?

Will the price of Ethereum (ETH) continue its freefall and test the $3,000 mark as Bitcoin (BTC) crashes below $96k?

Ethereum has dropped below the $3,500 psychological support as Bitcoin falls under the $96,000 level. As Bitcoin’s market cap dips below $2 trillion, Ethereum is holding on to its $400 billion valuation.

In parallel, Ethereum is holding onto the $3,400 support level as the crypto market turns red. Will sellers cause a breach at this level and push for a retest of $3,000?

Ethereum Price Analysis

Over the past seven days, Ethereum has dropped by 12.44%, reflecting the intense market correction. In the daily chart, the Ethereum price trend shows three consecutive bearish candles.

The bearish turn began after Ethereum faced a rejection at the $4,100 level. With the triple black crow pattern, Ethereum has cracked below the 50-day EMA line.

Furthermore, the price has reached the 78.60% Fibonacci retracement level at $3,553. As the downtrend continues, Ethereum is now testing the $3,400 level, with the current market price at $3,404.

As the price decline persists, the daily RSI has fallen below the halfway mark and is inching closer to the oversold boundary. The momentum indicator shows an increase in selling pressure.

Ethereum ETF Turns Red

Amid the declining price trend, Ethereum ETFs experienced a massive outflow of $60.47 million. Leading the bearish pack, Grayscale dumped $58.13 million worth of Ethereum. This surge in selling pressure has ended the bullish run in the Ethereum ETF market.

Whale Activity on the Rise

As Ethereum’s price volatility increases, ETH tokens are selling at discounted prices. Capitalizing on this, Donald Trump’s World Liberty Finance has spent $2.5 million to purchase 722 ETH tokens.

However, despite Trump’s firm’s bullish outlook, the market has seen whales turning bearish. Due to the recent price drop, whales are forced to sell to repay debts.

One whale recently deposited 22,746 ETH tokens worth $77.7 million to Binance, while another one deposited 31,968 ETH tokens worth $122 million over the past two days.

Furthermore, another whale deposited 49,910 ETH tokens, worth $170 million, over Binance and will convert them into stablecoins worth $137.8 million.

Will Ethereum Price Drop to $3,000?

In conclusion, as the broader crypto market turns bearish, Ethereum is facing increased selling pressure. The downtrend will likely gain momentum with institutional support and retail demand fading.

Based on Fibonacci levels and technical indicators, the 200 EMA line at $3,035 remains a crucial psychological support level. Beyond that, the 50% Fibonacci level at $2,942 could be a potential bounce-back zone. Ethereum’s price could challenge the 78.60% Fibonacci level at $3,530 if the broader market recovers.

Source