ETH's Price Recovery Faces Potential Downside Risks, According to Analysts
Ethereum (ETH), the second-largest cryptocurrency, has seen a 3.2% drop over the past week and is currently trading at $2,590. Analysts remain cautious about ETH's future performance, citing potential downside risks.
McKenna, partner at Arete Capital, shared that he does not expect ETH to break above the $2,800-$2,900 range in the coming months. This forecast follows a recent sell-off triggered by market maker Jump Trading and recession fears, which pushed ETH down by 21% to $2,112 before its recovery.
McKenna noted that ETH's rally to $2,750 encountered significant resistance around $2,800, suggesting that the price may stay range-bound for a while. He remains cautious about going long on ETH at current levels, advising that the range below could present buying opportunities.
Meanwhile, analyst Peter Brandt proposed two potential scenarios for Ether based on its chart patterns. The first scenario suggests a rise above $2,960, ideal for exiting long positions. The second involves a breakdown of a rising wedge, potentially leading to a drop to $1,650.
Data from Glassnode shows that while Ethereum’s funding rates have been mostly positive in 2024, the recent drop to $2,100 was accompanied by negative rates, indicating bearish bets. The relative strength index (RSI), positioned around 37, further supports the bearish outlook, suggesting market conditions still favor the downside.
