ETH/USD Daily Chart (Binance) – Source: TradingView

The Fear and Greed Index has slipped to fear territory once again at 27 and is nearing its 7-day low. This reflects the market’s cautious attitude ahead of any announcement this week.

The bullish scenario for ETH involves a breakout that reverses the latest downtrend and pushes the token out of the descending price channel shown in the chart. This would quickly put ETH on track to retest the $4,000 psychological threshold and could possibly rise beyond this mark if bullish momentum gains traction.

Meanwhile, the bearish scenario sees ETH maintaining its current trajectory and could lead to a drop to $2,700 in the near term, meaning a 23% downside risk.

At the time, the risk-reward ratio for a long position is a bit unfavorable, unless ETH explodes past $4,000, which is not necessarily the most likely scenario. Hence, short sellers may have the upper hand in these conditions unless the end of the shutdown flips the tables.