Ethereum Price Prediction: Why ETH May Continue to Fall

Ethereum price has crashed this year as its on-chain metrics waned, and spot ETH exchange-traded funds (ETFs) outflows rose. ETH has dipped for two consecutive weeks, hovering at its lowest level since December 2023. Here’s an exploration of why the value of Ethereum may continue to decline.

Weak Technical Indicators

The weekly chart indicates a strong downward trend over recent months. Ethereum has formed a triple-top chart pattern at about $4,050, characterized by three peaks and a neckline at $2,153, a highly bearish pattern.

Ethereum’s price has dropped to the neckline, suggesting a potential strong bearish breakdown. The pattern’s depth of about 46% implies that a similar crash could bring the price down to around $1,142, almost 45% lower than current levels.

Additionally, Ethereum has fallen below the 50% Fibonacci Retracement level of $2,475 and is also below the 50-week and 100-week Exponential Moving Averages (EMA). The Relative Strength Index (RSI) and MACD indicators are trending downwards, indicating a likely continued decline, with a critical target at $1,500. This bearish outlook could become invalid if the price surpasses the 38.2% retracement point at $3,000.

ETH ETF Outflows

Ethereum’s price has also been impacted by reduced demand from Wall Street investors. Recent data shows that while all ETFs have accumulated over $2.7 billion since their approvals, spot Bitcoin ETFs have garnered over $40 billion.

ETH ETFs struggle partly due to the opportunity cost of holding Ethereum itself, which is often more profitable due to staking features. Ethereum boasts a staking market cap over $72.8 billion, significantly surpassing the $7.7 billion total assets in ETFs. Recent data shows that Ethereum ETFs have shed more than $455 million in assets over the past two weeks, including $23 million in one day alone.

Declining Network Fees

Additionally, Ethereum’s revenue has declined compared to previous years, generating only $206 million this year—making it the third-most profitable layer-1 network after Tron and Solana. Tron, in particular, processes over $60 billion in stablecoin transactions daily, outperforming Ethereum and pushing it down the profitability rankings.

Ethereum’s network has also lost market share against competitors like Solana, Arbitrum, and Base, handling around $81 billion in the last 30 days, compared to Solana’s $92 billion. This, in conjunction with the weak on-chain metrics, suggests that Ethereum will face challenges in regaining market share in the near future.

Read more: Ethereum price prediction March: Is another 50% crash possible?
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