Ethereum (ETH) Price Crashes Below $2K, Forming Another Risky Pattern

Ethereum’s price remains in a deep bear market after plunging more than 53% from its November high.

Ethereum (ETH) price is still grappling with a deep bear market following a 53% decline from November’s high. The crucial support level of $2,000 has now been breached by the token, and it is currently approaching its lowest point since November 6.

This downturn continues as the demand for the coin has waned in Wall Street. Over the last three consecutive weeks, all spot Ethereum ETFs have witnessed outflows, ultimately leading to a cumulative net outflow of $2.52 billion. Consequently, total assets have dropped to approximately $6.72 billion.

Moreover, the crypto market has seen a rise in fear, further contributing to Ethereum’s decline. The closely watched crypto fear and greed index has slipped into the fear zone at 21. Bitcoin (BTC) and other altcoins tend to underperform during periods of weak investor sentiment.

The recent sales of ETH tokens by the Ethereum Foundation have not aided the recovery. Just last week, Harikrishnan Mulackal, a former engineer at the foundation, issued a stark warning that without clear leadership, the future of Ethereum was at risk.

Furthermore, the Ethereum network has encountered substantial competition from other layer-1 chains, such as Solana (SOL) and BSC Chain. According to DeFi Llama, DEX protocols on Ethereum processed $1.012 billion in token volume on Monday, lagging behind BSC’s $1.63 billion and Solana’s $1.077 billion.

Ethereum price has formed another risky pattern

The ongoing crash in ETH price follows the formation of a triple-top pattern on the weekly chart. This pattern is characterized by three peaks and a neckline, which in this instance, was located at $2,126.

Additionally, Ethereum experienced a death cross on the daily chart when the 50-day and 200-day moving averages converged on February 13. A death cross is widely recognized as one of the riskiest patterns in technical analysis.

Now, ETH is gradually forming another bearish pattern known as a pennant. This formation consists of a long vertical line followed by a symmetrical triangle. The triangle is approaching its confluence point, suggesting that a bearish breakdown could occur soon.

Therefore, a break below the year-to-date low of $1,757 could signal further declines to the psychological level of $1,500.

One potential catalyst that may boost Ethereum’s price this week is the upcoming Federal Reserve interest rate decision on Wednesday. A dovish stance from the Fed could have a positive impact on ETH and other cryptocurrencies.