Ethereum (ETH) is facing significant market pressure, largely influenced by Bitcoin’s recent decline below $93,000. The cryptocurrency’s price struggles to hold key levels, with the support trendline now coming into focus as a critical factor for its price movement. While the current bearish sentiment is evident, there remains potential for Ethereum to make a strong recovery if it can break through certain resistance levels in the coming weeks.

Ethereum Price Struggles Below $3,400

Ethereum’s recent price movement shows a notable decline, with the token currently trading at $3,345. This marks a shift below the crucial $3,400 level, which had previously served as a key point of support. Ethereum is consolidating just above $3,300, attempting to hold onto local support, but the broader market conditions have made it increasingly difficult to maintain upward momentum.

The technical chart reveals a compression pattern on the 4-hour timeframe, suggesting that Ethereum is forming a short-term triangle. This type of pattern often precedes significant price movements, either in the form of a breakout or a breakdown, making it a pivotal moment for ETH investors.

Bearish Sentiment and Technical Indicators

Ethereum’s bearish outlook is further supported by several technical indicators. The dynamic average lines, such as the 100-EMA and 200-EMA, have recently shown a negative crossover, signaling potential sell pressure. This crossover is traditionally viewed as a bearish sign, as it indicates that short-term momentum is weakening compared to the longer-term trend.

In addition to the moving averages, the 4-hour Relative Strength Index (RSI) has struggled to stay above the neutral 50 level. A weak RSI often indicates a lack of buying pressure, which could contribute to the downward trend if Ethereum fails to break through resistance levels. Furthermore, the absence of bullish divergence at the support trendline highlights that there is a lack of significant underlying demand for Ethereum at this point, adding to the cautious sentiment.

Ethereum ETFs See Outflows

Ethereum’s struggle is not limited to its spot market. Institutional support for ETH has been dwindling, as evidenced by significant outflows from Ethereum ETFs. On December 30, Ethereum saw a daily net outflow of $55.41 million. Among the withdrawals, Fidelity pulled $20.41 million from Ethereum ETFs. With no significant inflows reported on that day, institutional support appears to be waning, further contributing to the downward pressure on ETH’s price.

This trend mirrors the challenges faced by Bitcoin’s ETFs, where market sentiment has been impacted by broader economic factors. For Ethereum, the lack of inflows may indicate that institutional investors are taking a more cautious stance, possibly due to the uncertainty in the broader crypto market.

ETH Price Targets: Support and Resistance Levels

As Ethereum attempts to find its footing above the critical $3,300 support trendline, traders and analysts are closely watching for signs of a breakout or further decline. To confirm a bullish continuation, Ethereum must maintain support above the $3,400 mark. If Ethereum can hold this level and push upward, the next target would be the $3,568 supply zone, which represents significant overhead resistance.

On the other hand, if the triangle pattern breaks to the downside, Ethereum could face further declines, with the next support level at $3,244. This level would likely be tested if bearish pressure continues to mount in the coming days.

The Outlook for Ethereum in 2025

Looking ahead, Ethereum’s price movement will largely depend on how it navigates the current support trendline and the resistance levels ahead. The broader market sentiment will also play a crucial role in shaping ETH’s trajectory, especially as the crypto market enters 2025.

While Ethereum faces challenges, including outflows from ETFs and technical indicators pointing to short-term bearishness, there remains a glimmer of hope for a recovery. A successful bounce off the support trendline and a breakout above $3,400 could signal a rally toward the $3,568 level, providing some optimism for Ethereum holders heading into the new year. However, without a sustained influx of institutional support or a shift in market sentiment, Ethereum’s price could continue to face downward pressure, especially if it breaks below the support trendline.

In conclusion, Ethereum’s next major move will be crucial in determining its short-term direction. Traders and investors should keep a close eye on the $3,400 support level, as it will likely serve as a critical battleground for bulls and bears in the coming weeks. With macroeconomic factors and broader crypto market conditions at play, the coming months could prove pivotal for Ethereum’s price action.

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