Ethereum (ETH) price perfectly met my prediction, which was mentioned in the last article. Our analysis shows that due to a recent breakdown on the chart, ETH price may drop a lot more in the coming days. Nevertheless, the bulls still have some time to gain back control.
On Tuesday, crypto markets turned red as the BTC price broke below $27,500. This triggered a panic-induced sell-off in the altcoins, including ETH. Consequently, the Ethereum price dropped close to its monthly lows. Despite a 1.23% drop in ETH/USDT, ETH/BTC pair still rose by 1.48%.
Why Is ETH Price Tanking?
There are multiple fundamental and technical factors behind the negative ETH price action. According to the most recent news, Ethereum Foundation has sold $30 million worth of ETH. On May 6, a massive chunk of Ethereum was transferred to the Kraken cryptocurrency exchange by the Foundation.
This could be one of the reasons behind the Ethereum price drop this week. In other news, the gas fees on the top smart contract platform are once again going bonkers. This is due to the ongoing memecoin season, which has resulted in increased on-chain activity.
Ethereum Price Breaks Down From Rising Wedge
The following ETH price chart reveals that the price has broken down from the rising wedge pattern. These patterns are very bearish patterns as the price usually targets the bottom of the wedge after the breakdowns. The bottom of the wedge currently lies at $1,367, which is 25% below the current price of $1840.
However, this Ethereum price prediction will only be valid if the price closes a day below $1,820. This will form a lower low on the daily chart, which will confirm the bearish market structure. A lot also depends on the BTC price action in the coming days as well as on the upcoming CPI report.
I’ll keep posting my updated analysis on Ethereum & other cryptocurrencies in my free Telegram group that you’re welcome to join.