The Ethereum price continues to crash, nearing a ‘point of no return.’ While Ether plunged below $1,500 in USD terms, the real action is happening in the ETH/BTC pair. Ethereum plummeted to a low of 0.02 BTC on Wednesday and is hovering at its lowest point since February 2020. It has plummeted by over 78% from its highest level in 2022.
Ethereum Price Technical Analysis
The monthly chart indicates that the Ethereum price is gradually entering a crisis scenario this week. The ETH/BTC pair has crashed in the last five consecutive months, the longest losing streak since 2018.
It has remained below the 50-month and 25-month moving averages, indicating that bears remain in control for now. The Average Directional Index (ADX) has jumped to 28, signaling that the bearish trend is gaining momentum.
Additionally, the ETH/BTC pair is forming an inverted cup and handle pattern, highlighted in red. This is a popular continuation pattern that leads to more downside over time. It is now nearing the lower edge of this pattern, suggesting that a bearish breakdown may happen soon.
The breakdown will be confirmed if the coin drops below the lower edge of the cup at 0.01644. This cup is about 80% deep. Therefore, measuring the same distance from the lower edge of the cup suggests it may soon crash to $0.00187. This is a notable level that coincides with its all-time low.
READ MORE: Ethereum Price Prediction: How Low Can the ETH Crash Get?
Why ETH Price is Imploding
Several reasons explain why the Ethereum price is imploding. First, signs indicate that Ethereum’s decision to allow layer-2 networks on its blockchain has dealt a significant blow. L2 networks like Base and Arbitrum are built on top of Ethereum, which helps to ensure their security. However, unlike Ethereum, they are faster and cheaper, which is why many people use them.
Secondly, evidence points to Ethereum stakers unloading their assets. Data from Staking Rewards indicates that the network experienced two consecutive days of outflows. This is notable since Ethereum is the most staked coin in the crypto industry.
Thirdly, Ethereum has continued to lose market share to networks like Solana and BNB. Most importantly, demand on Wall Street has waned as the spot ETH ETFs have seen strong outflows in the past few months.
READ MORE: Bitcoin Price Prediction: Technical Analysis Shows the BTC Targets
