Ethereum (ETH) Price Struggles to Validate an Upward Trend as On-chain Metrics Signal Increased Chances of a Correction

Following comments by Federal Reserve Chair Jerome Powell, Ethereum's price is struggling as it fails to validate a clear upward trend.

Federal Reserve Chair Jerome Powell’s comments have implications for Ethereum’s price as it struggles to validate a clear upward trend. During a speech in Chicago on April 16, Powell stated that the Fed is in no hurry to cut interest rates.

This cautious “wait-and-see” approach, dependent on further economic data, as announced by Fed Chair Jerome Powell, could affect Ethereum’s price trends.

As the Fed chair mentioned that the US central bank is in no hurry to reduce interest rates, despite the recent rise in inflation, it is evident in the chart that after a brief attempt to recover, ETH price faced immediate bearish pressure.

Following this announcement, data from Coinglass shows a surge in Ethereum exchange inflows. Over the past 24 hours, around $40.6 million in crypto liquidations occurred, with long positions encountering greater losses at approximately $26 million, compared to $14.6 million in short positions.

The recent price decline coincided with a sharp increase in exchange reserves. On the previous day alone, over 77,000 ETH was transferred to derivative exchanges, marking the largest single-day net inflow in several months. This sudden rise in supply increases the potential for selling pressure.

However, data from blockchain analytics firm IntoTheBlock reveals that the Netflow metric remains negative, at approximately -6,800 ETH. This indicates that overall outflows have exceeded inflows, suggesting many investors were accumulating ETH amid the price decline.

Moreover, Coinglass highlights that despite the downward pressure, open interest has been rising. The OI metric surged by over 3.87%, reaching above $18 billion. However, the funding rate has been trending in the negative region at 0.0015%.

This indicates that although bears still have the upper hand and are expected to maintain control at immediate Fib support levels, the current decline might turn out to be a strong rebound.

CryptoQuant analyst Mohommad Ahmadyar notes that Ethereum is now trading close to its realized price, a level that has often signaled major rebounds in the past. The realized price, currently around $1,585, is seen as a strong point for value buying.

After a steep decline from the March highs, Ether’s attempt at a price recovery is losing momentum around EMA trend lines as bears are seen to be defending the EMA20 level.

As a result, the price is now seen pivoting at the descending resistance line, and if sellers manage to break below the lower boundary of the channel, it could trigger a deeper decline toward the end of the bearish channel at $1,130. This level is expected to attract buying interest.

But if bearish momentum remains strong, a further drop toward $1K is possible. On the upside, a decisive break and close above $1,700 would be the first indication that buyers are regaining control.

Such a move could open the path for a rally toward $2K. Although the 50-day SMA might slow down the recovery, it is likely to be surpassed if bullish momentum builds. A strong push above $2K would suggest that the downtrend may be reversing.