Ethereum Price Dips Below $2,000: Is $1,060 the Next Target?

Ethereum Price in Freefall: Why $1,060 Could Be the Bottom

Ethereum Price Dips Below $2,000- Ethereum’s price has been on a prolonged downward trajectory, raising concerns among investors and analysts alike. Despite recent attempts at recovery, the cryptocurrency’s price continues to remain vulnerable to further declines. Analysts suggest Ethereum’s price could potentially reach as low as $1,060 if current trends persist. A combination of weak market structure, lack of bullish momentum, and negative on-chain data is driving this bearish sentiment.

Ethereum Faces Multiple Rejections at Key Resistance Levels

Recent technical analysis points to Ethereum’s ongoing struggle to break through the critical $4,000 resistance level. According to price analysis from Mags, Ethereum has been rejected three times at this key level during this cycle, each rejection leading to further price declines. Most recently, the cryptocurrency was pushed below its mid-range level and is now trading below an upward-sloping trendline support that had been holding since the bottom of the previous cycle.

Market analysts caution that Ethereum must reclaim $2,500 in the near term to avoid a further decline. If the price continues to fall below current levels, it could be poised for a drop to $1,060, where key support is located. The current lack of strong support for Ethereum suggests that the downward momentum could persist without a significant recovery.

ETH/BTC Pair Struggles to Gain Strength

Ethereum’s relative strength against Bitcoin has also been underperforming, a key indicator of its weakness in the market. The ETH/BTC pair continues to trend downward, with the Relative Strength Index (RSI) on the three-day chart staying below 30. While an RSI below 30 typically signals an oversold condition, historical trends indicate that oversold levels do not always mark a definitive bottom for Ethereum’s price.

Since mid-2024, the ETH/BTC pair has suffered multiple breakdowns, including declines of 13%, 21%, 25%, and 19.5%. The 50-day and 200-day Exponential Moving Averages (EMAs) continue to trend downward, reinforcing the bearish outlook for Ethereum. Analyst CarpeNoctom further emphasizes that the ETH/BTC pair has yet to confirm a bullish divergence on its weekly chart, suggesting that Ethereum may struggle to gain support in the near term.

Declining ETF Flows and Weak On-Chain Activity Raise Concerns

In addition to weak price action, Ethereum-based exchange-traded funds (ETFs) have experienced consistent outflows throughout the year. As of March 2021, the net assets of spot Ether ETFs decreased by 9.8%, totaling $2.54 billion. In contrast, Bitcoin ETFs saw a slight decrease of 2.35%, reaching $35.74 billion. This divergence signals that institutional fund managers may be losing interest in Ethereum, potentially further weakening the cryptocurrency’s outlook.

Moreover, on-chain data points to a declining network usage, with median gas fees fluctuating around 1.12 GWEI in March, a significant drop compared to the previous year. This decrease in gas fees suggests fewer transactions are taking place on the network, which could indicate lower demand for Ethereum in the short term.

Support Levels and Future Outlook for Ethereum

As Ethereum continues to trade below key resistance levels, technical analysts suggest that the next support level is at $1,060, which aligns with the lower limit of its long-term trading range. As of the latest data, Ethereum is trading at $1,923.03, representing a 27.81% decrease from the previous month. Despite Ethereum’s market cap of $231.96 billion, the ongoing downward trend indicates that selling pressure continues to weigh heavily on the price.

Technical analysts believe that unless Ethereum manages to reclaim significant resistance levels, the bearish trend may persist. The lack of strong recovery and ongoing pressure from negative on-chain metrics suggest that Ethereum could remain vulnerable to further declines, potentially reaching the $1,060 support zone in the near term.

Ethereum’s Struggles Highlight Broader Market Weakness

The ongoing weakness in Ethereum’s price reflects broader market sentiment, with investors wary of the potential for further losses across the crypto space. The decline in institutional interest and the weakening on-chain activity only compound the uncertainty surrounding Ethereum’s future. As the cryptocurrency continues to face rejection at critical resistance levels and struggles to establish new support, market participants are closely watching for any signs of recovery.

Ethereum’s path forward will depend largely on the resolution of broader market issues and whether the cryptocurrency can break through resistance levels to establish a new uptrend. Until then, the prevailing bearish sentiment suggests that further declines could be in store for Ethereum, with the $1,060 support level remaining a critical point for potential price stabilization.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.