20% Crash or Renewed Rally for Ethereum (ETH) in the Short Term? Analysts Chip In

TL;DR

ETH has dropped 11% over the past month, with analysts warning of a possible further decrease to $1,800 if key support levels fail.Others predict a potential rebound, citing a “bear trap” pattern and historical trends.

Further Pain for ETH Bulls?

Ethereum (ETH) has been among the worst-performing cryptocurrencies (from the top 10 list) lately, with its price dipping by 11% on a monthly scale. It is down 4% in the past 24 hours and currently trades at around $2,300 (per CoiGecko’s data). 

One popular analyst who thinks ETH’s decline could be far from over is X user Ali Martinez. He outlined the $2,290-$2,360 range as a “key support” level, where 1.9 million addresses hold approximately $52.3 million worth of the asset. 

The crypto enthusiast believes ETH could crash by 20% to as low as $1,800 should its price dip below that zone. Recall that its valuation briefly plunged to $2,260 a few hours ago.

ETH Price, Source: CoinGecko

Certain on-chain metrics also suggest that Ethereum could experience a further correction in the near future. One example is the “In the Money” indicator, which is down by 0.19% daily. It shows the change in the number of ETH investors currently sitting on paper profits. As of now, 54% are in the green, while 39% are underwater.

The Bullish Scenario

Contrary to Ali Martinez’s assumption, numerous other analysts are optimistic that ETH is poised for a revival. The X user Phoenix thinks the asset’s chart has formed a “bear trap,” signaling a potential resurgence in the following months.

JAVON MARKS claimed that Ethereum’s pattern seems to have mirrored the one from 2023, which led to a 165% price increase.

“2023 looks to have been the blueprint for another massive upside that can soon be transpiring in this crypto market. Target is at $4,723.5, and a break above can welcome $8,100+ into play, projecting another near 2X in price, if not much, much more,” the analyst argued.

Last but not least, ETH’s RSI has recently plummeted to a bullish ratio of around 30. The Relative Strength Index (RSI) helps traders assess overbought or oversold conditions and thus predict possible price reversals. Readings below 30 generally indicate that ETH is oversold, which could be a precursor of a rally. Conversely, a ratio above 70 could be interpreted as bad news for bulls since it can be followed by a correction.