Ethereum Price Threatened With Sharp Drop To $1,400, Here’s Why

Ethereum might be on track to facing renewed pressure, according to an interesting technical outlook. Despite short bursts of recovery attempts, the broader market structure is still trying to flip in favor of bulls, but price movement shows that the bears are still in control. Notably, a recent technical analysis posted by crypto analyst Youriverse on the TradingView platform highlights a potential sharp drop in the price of Ethereum towards $1,400 if the current downward trend continues.

Strong Rejection From Key Fibonacci Zone Hints At Persistent Resistance

Technical analysis shows that the Ethereum price chart is currently characterized by a noticeable Fair Value Gap (FVG) on the 4-hour timeframe. This interesting gap was left behind after a steep 10% drop last Sunday, marking a strong area of seller dominance.

This gap represents a zone of clear imbalance where selling activity outweighs buying pressure and has influenced Ethereum’s price action throughout the past seven days. Earlier last week, Ethereum retraced into this gap, reaching the midpoint, but was met with swift rejection. This swift rejection showed the intense selling pressure present within this Fair Value Gap.

Stochastic RSI Weakness Suggests Possible Downturn Ahead For Ethereum

Furthermore, Ethereum is trading within an area identified as the “golden pocket” of the Fibonacci extension indicator, which is drawn from the $1,383 bottom on April 9. Unless price action breaks decisively above this level and heads toward the next Fib level of 0.786 at $1,724, there is still a risk of a significant rejection that could lead to further downside below $1,400.

Conclusion

The Ethereum price is likely to continue its downward trend if the selling pressure builds again, as suggested by both the weakening RSI and persistent resistance at the Fair Value Gap. The analyst warns of a breakdown that could drag the price to as low as $1,400, or even lower.

FAQs

Q: What is the current status of the Ethereum price?
A: At the time of writing, Ethereum is trading at $1,627.

Q: What is the predicted price movement of Ethereum?
A: The analyst suggests that the Ethereum price could drop to as low as $1,400, or even lower, if the selling pressure builds again.

Q: What is the significance of the Fair Value Gap (FVG) in the Ethereum price chart?
A: The FVG represents a zone of clear imbalance where selling activity outweighs buying pressure and has influenced Ethereum’s price action throughout the past seven days.

Q: What is the role of the Stochastic RSI in the Ethereum price analysis?
A: The Stochastic RSI is a momentum oscillator that measures the relative strength of recent price movements. Its weakness suggests a possible downturn ahead for Ethereum.

Q: What is the significance of the golden pocket in the Fibonacci extension indicator?
A: The golden pocket is an area of high resistance identified by the Fibonacci extension indicator. A breakdown of this level could lead to further downside below $1,400.

Q: What is the predicted timeframe for the Ethereum price drop?
A: The analyst warns of a possible breakdown that could occur in the near future, potentially within the next few days or weeks.

Q: What is the implication of the predicted price drop on the Ethereum market?
A: A price drop could lead to increased selling pressure, further downward momentum, and potentially even a market-wide correction.

Q: How can investors prepare for the predicted price drop?
A: Investors may want to consider diversifying their portfolios, adjusting their risk tolerance, and setting stop-loss orders to limit potential losses.

Q: What is the role of the crypto analyst in the Ethereum price analysis?
A: The crypto analyst’s technical analysis and insights provide valuable information for investors to make informed decisions about their Ethereum investments.

Q: What is the significance of the TradingView platform in the Ethereum price analysis?
A: The TradingView platform provides real-time market data and technical analysis tools, allowing analysts like Youriverse to create and share their insights with the global crypto community.

Q: What is the implication of the predicted price drop on the Ethereum ecosystem?
A: A price drop could have significant implications for the Ethereum ecosystem, including decreased adoption, reduced liquidity, and potentially even a decline in the overall market capitalization of the cryptocurrency.