Ethereum Price News: Early Rejection of $1,800 Raises Odds of 18% Drop

Key Points

• Ethereum has rejected a move above $1,800, indicating a potential drop of 18% if selling pressure increases.
• Macroeconomic conditions have worsened, with expectations of a 50 basis points rate hike this year.
• Despite a bearish short-term outlook, there is a belief that Ethereum may be near its cycle bottom.

Market Overview

Ethereum (ETH) has seen a 4% recovery over the past week, attributed to a technical bounce in the crypto market. However, overall sentiment remains low due to deteriorating macroeconomic conditions.

Recent comments from the new head of the Federal Reserve, Kevin Warsh, regarding inflation suggest a tightening monetary policy, which has negatively impacted the crypto market. This shift in sentiment mirrors the downturn experienced in 2021-2022, which severely affected cryptocurrency valuations.

Technical Analysis

Ethereum's recent price action shows a rejection at the $1,800 level, which was previously a support area but has now turned into resistance. If the selling pressure continues, the price could retest the April 2025 low of $1,400, representing an 18% downside risk from current levels.

Currently, Ethereum is the worst-performing token among the top five cryptocurrencies, even lagging behind Solana. Historical patterns suggest that the token may be nearing its cycle bottom, with a belief that it will not drop below $1,400 unless macroeconomic conditions worsen significantly.

Future Outlook

The Relative Strength Index (RSI) indicates that Ethereum is nearing a strong sell signal, currently sitting at 40. A failure to break above $1,800 could lead to a decline towards $1,400 in the coming days.

Despite the bearish outlook, the end of the conflict with Iran may alleviate some economic pressures, potentially allowing the Fed to delay rate hikes. This scenario could provide a more favorable entry point for long-term investors if Ethereum drops to $1,400.