Why is Ethereum (ETH) Price Down Today?
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Key Takeaways:
- Bitcoin correction swept ETH off its local top.
- Several Ethereum future ETFs launched in the US on Oct. 2.
- Interest in the Network grows.
NOIDA (CoinChapter.com)—The Ethereum (ETH) price recovered slightly on April 18 after being in a three-day continuous downtrend in the current week. However, the bearish cues plaguing Bitcoin could become radioactive for ETH prices, too.
Jerome Powell’s announcement that the Federal Reserve could keep interest rates higher for longer than anticipated would likely weigh heavy on ETH price action.
Furthermore, technical factors also predict a bearish time ahead for the Ethereum token.
Geopolitical and On-Chain Bearish Threats to ETH Price
The spike in geopolitical tensions in the Middle East over the weekend led to a downturn in cryptocurrency markets after drone attacks on Israel, affecting weekend trading with Bitcoin and Ethereum prices falling by 8% and 13%, respectively.
According to an analyst commenting on Bitcoin’s halving price action, while the markets had priced in the attack on Israel, there was still a counter-attack from Israel that traders needed to factor into their analysis.
If and when it happens, the tensions could destabilize Bitcoin, as well as Ethereum’s price action.
Additionally, in the Ethereum ecosystem, significant discussions are ongoing about proposed changes to its issuance rate. Two Ethereum researchers have suggested reducing the ETH issuance to manage the staking pool’s growth and mitigate the rising dominance of innovations like Liquid Staking and Restaking.
With traders increasingly opting to stake their ETH, particularly through new protocols like EigenLayer and innovations such as Liquid Staking, Restaking, and Liquid Restaking, there is an increased issuance of ETH to reward stakers.
Per a Glassnode report, the growing popularity of Liquid Staking and Restaking Tokens might reduce ETH’s appeal as a currency, potentially shifting its monetary role to these derivatives and influencing Ethereum’s governance and stability.
Additionally, the high rate of staking could lead to inflationary pressures if the rewards exceed the amount burned. Inflation typically devalues a currency, potentially lowering ETH’s price.
The aim is to preserve Ethereum’s functionality as a form of money in the face of these new developments, which have increased the staked ETH to 31.4M, or about 26% of the total supply.
Ethereum Price Formed A Bearish Technical Pattern
The GALA token has formed a bearish technical pattern called the ‘Descending Triangle.’
Market analysts predominantly consider the descending triangle a bearish continuation signal in a technical chart pattern. A downward-sloping upper trendline characterizes this pattern, with declining resistance levels that progressively lower the peaks of the price action.
Additionally, a horizontal lower trendline acts as support, maintaining a consistent low point that the price struggles to breach. The formation indicates that selling pressure is gradually increasing, overcoming the buying interest, as each rally is weaker than the last.
In a descending triangle setup, the height of the triangle’s thickest section determines the price target. If the bearish pattern pans out, ETH price could drop over 48% to reach the projected price target near $0.0154.
The post Why is Ethereum (ETH) Price Down Today? appeared first on CoinChapter.
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