Is this a buying opportunity or ETH’s price will dump even more?
The second-largest digital asset tumbled to its lowest level since the beginning of April, mirroring a broader market pullback triggered by escalating tensions between the US and Iran.
Many analysts warn that a deeper correction may be developing, though an important technical indicator signals a potential recovery.
Further Slump Incoming?
Several hours ago, ETH dropped below $2,100 before slightly rebounding to the current $2,150 (CoinGecko’s data), indicating a substantial 8% decrease over the past week. The renowned analyst Ali Martinez argued that the asset seems to be breaking out of another flag, underscoring the significance of the $1,100 area as a key accumulation region.
It is important to note that nearly a week ago, he described the $2,200-$2,400 range as a “no-trade zone,” claiming that only a sustained close outside this area will define “the next major move.”
Other worrying factors that Martinez has touched upon lately include the rising number of ETH tokens stored on exchanges (which increases selling pressure) and a TD Sequential indicator that flashed a sell signal.
Crypto Rover also gave his two cents. He told his 1.5 million followers on X that the ETH appears to be repeating the setup seen in 2022, suggesting the current cycle may still lie ahead. For his part, Sjuul | AltCryptoGems opined that the cryptocurrency has lost stamina, just as expected.
“Now it has receded to the lower band of the channel and is threatening to break below it. Either buyers will step in soon, or things are going to get nasty here,” he added.
The Silver Lining
Despite the bearish sentiment and broader market weakness, ETH’s Relative Strength Index (RSI) suggests an impending resurgence. The technical analysis tool measures the speed and magnitude of recent price changes, as traders often use it to identify possible reversal points.
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It runs from 0 to 100, where anything below 30 indicates that the asset has entered oversold territory and could be due for a revival. In contrast, readings above 70 mean that ETH is overbought and poised for a potential correction.
Just a few hours ago, the RSI dropped to around 23, the lowest level since early February. Currently, it stands at roughly 30, which still supports the bullish outlook.
- ETH RSI, Source: CryptoWaves
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