Ethereum’s price has experienced a significant decline, dropping to a key support level following the Federal Reserve’s hawkish interest rate announcement. The cryptocurrency fell to $3,540, reflecting a 10% decrease from its recent peak earlier this week. This downturn aligns with a broader sell-off affecting major cryptocurrencies like Bitcoin and Solana.
Despite the falling prices, the underlying fundamentals for Ethereum remain robust. Significantly, Ethereum Exchange-Traded Funds (ETFs) have seen consistent inflows, accumulating over $2.46 billion, marking 18 consecutive days of increased investment. This trend indicates a growing attraction among investors.
Ethereum ETFs are becoming increasingly popular as market participants speculate that regulatory authorities may soon permit staking within these vehicles. The current lack of staking options has likely limited some institutional investors from fully committing to these ETFs.
Major investment firms continue to hold substantial amounts of Ethereum, as seen with funds from notable companies in the space. Meanwhile, the number of staked ETH tokens continues to rise, surpassing 54.7 million, with more than 206,000 unique stakers contributing to this growth. This trend signals strong long-term bullish sentiment among investors committed to holding their ETH assets.
Ethereum maintains its position as a dominant force in the blockchain sector, with the total value locked in its Decentralized Finance ecosystem soaring to over $73.7 billion. This value far exceeds that of competing chains such as Solana, Base, and Arbitrum combined.
The recent retreat in Ethereum’s price comes after the Federal Reserve adjusted its interest rate outlook, now projecting two rate cuts instead of four in 2025. Historical data suggests cryptocurrencies and other risk assets tend to perform better under a dovish Fed stance.
Ethereum Price Analysis
The latest daily chart for Ethereum indicates a sharp reversal after it reached $4,090, a crucial resistance point. This level aligns with previous highs and indications of overextension on technical analysis charts.
A bearish double-top pattern has emerged, with the neckline positioned at $3,526. This formation suggests the potential for further declines, with ETH possibly testing significant support at $3,125. Conversely, a confirmation of upward momentum would require Ethereum to break above the resistance level at $4,090.
