Ethereum
Ethereum Misery Compounds: ETH Nears $2,800 Floor
Ethereum is under immense liquidation pressure and the downtrend momentum persists, regardless of optimistic supporters. The uptrend is capped due to Bitcoin’s weakness and growing fears that the US SEC may classify the coin as a security. If so, it will be a big blow to ETH in the medium to short term. The decision to classify the coin this way could also depress prices, much like the fall in XRP when the regulator took Ripple to court in late 2020.
At press time, ETH prices remain in the red, and that could be the situation this week unless there is a sudden reversal of fortune. According to trackers, the coin is stable on the last day and down 3% from the previous week. If bearish Ethereum forces prices below the $2,800 low, further losses could be ahead. So far, trading volume has been low, hovering around $11 billion in the last trading day.
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The following Ethereum news events will make or break the coin:
- Analysts are confident that the US SEC considers ETH a security, given the response ETF applications are receiving. This classification automatically means that the regulator will not approve the product until there is a legal definition of the asset.
- After integrating EIP-1559 and introducing basic charges and combustion functionality, Vitalik Buterin wants the entire gas model to be revised. Now, through EIP-7706, the co-founder wants a new gas fee model for call data. Layer 2 protocols now use the cheapest blobs after Dencun went live.
Ethereum Price Analysis
All ETH/USD the structure remains bearish at spot rates.
As Ethereum prices hit new lows, momentum fades. At the same time, prices continue to form a bullish flag, given the strong increases recorded in the first quarter of 2024.
Technically, ETH has support at $2,800. On the upper side, resistance is at $3,300.
As mentioned earlier, any decline below $2,800 (April and May lows) will likely trigger a sell-off, accelerating the fall to $2,600 and $2,200.
The speed of decline will be higher if the breakout bar has a higher trading volume than the recent average.