The weekly chart of Ethereum has revealed a death cross pattern. Will the price crash due to the continued decline in demand for ETFs?
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- The weekly chart of Ethereum has shown a cross-death.
- In the last four months, over $2.6 billion left ETFs that track spot Ether.
Crypto.news reports that Ethereum (ETHThe price of ) has fallen precipitously since the middle of January this year. The leading altcoin, by market capital, is still 40% below its annual high, despite trading around $2,000 – a psychologically important level.
A sharp drop in prices was seen amid massive liquidation events The sector has been plagued by a number of headwinds that are bearish. macroeconomic Geopolitical Fronts
As it stands, Ethereum’s price is still at risk for a prolonged downtrend. Traders are in a precarious position now that the highly bearish pattern was validated. The weekly chart shows that the exponential moving average for the last 20 days has been crossed under the one from the previous 50 days, creating what is known as a death-cross.
When accompanied by bearish indicators, death crosses can be a powerful indicator of an upcoming downtrend.
Recent ETH price action has respected a descending parallel channel pattern, which had been forming since mid-August last year. As long as an asset’s price stays within the boundary of the pattern over time, the trend tends to be down.
This bearish forecast is very likely, since the ETH price fell below the Fibonacci retracement at $2,200. This makes ETH prone for a decline towards the lows of April 7th, $1,380. It would be a drop of about 30% from the current price.
The bearish prediction will not be valid if the bulls are able to push the ETH rate back up above $2,200.
Ethereum’s demand has also declined. Data SoSoValue reports that nine Ethereum spot ETFs are down $278 Million in the first month of this year.
The cumulative monthly outflows from November to now totaled over $2.6 billion.
This kind of consistent outflow tends to reduce retail interest, and it removes a significant safety net previously supporting the Ethereum price in periods of volatility.
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Source: crypto.news
