Ethereum Price Outlook: Three Factors Suggest Potential Further Declines

Ethereum’s recent 18% price rally might not confirm it has bottomed. Analysts cite three reasons for potential declines: a critical resistance level at $1,630, an RSI that isn’t oversold, and uncertain macroeconomic conditions. Key support levels to monitor are between $1,280-$1,160 and $890-$715.

Ethereum’s recent price upswing of 18% could be misleading, as it might not signify a definitive market bottom. Analysts identify critical factors that suggest further declines are plausible, including resistance levels, RSI metrics, and ongoing macroeconomic uncertainties. Key support ranges to monitor include $1,280-$1,160 and $890-$715, essential for assessing market health.

Despite a rising trend influenced by Bitcoin’s surge towards $85K, Ethereum (ETH) faces potential challenges. Notably, the price has approached the previous all-time high (ATH) of $1,385, creating optimism among traders. However, three significant reasons indicate that ETH could face additional declines.

First, the importance of the key resistance level is underscored by the weekly TradingView chart. As Ethereum nears $1,630—the highest volume trading level since February 2021—bears have pushed it below this mark. To reverse this trend, bulls need to convert this resistance into new support. Furthermore, the intermediate demand zone between $1,280 and $1,160 is crucial for absorbing selling pressure. This range has historically supported upward movements in ETH.

Second, the Relative Strength Index (RSI) currently does not reflect oversold conditions on the weekly chart. Historically, significant rallies in Ethereum’s price have corresponded with the RSI dipping into oversold territory. This suggests a potential for further price declines before significant recovery may occur, particularly approaching the $1,280-$1,160 and $890-$715 support areas.

Lastly, macroeconomic factors contribute to a bearish sentiment surrounding Ethereum. The ongoing trade tensions between the United States and China, as exemplified by the Trump-Xi trade war, add unpredictability to both stock and cryptocurrency markets. With critical events approaching, such as Fed Chair Powell’s speech and March inflation statistics, market responses to these could provoke further volatility, impacting ETH’s stability.

In conclusion, the outlook for Ethereum’s price remains neutral to bearish, necessitating caution among investors. Awareness of the anticipated economic events and current market dynamics is essential for navigating potential price fluctuations.