Ethereum price was stuck below the important support of $2,000 today, February 16, as it erased the gains made during the weekend.
Summary
- Ethereum price may be at risk of falling to the key support at $1,500.
- It has formed a bearish pennant pattern on the daily timeframe chart.
- The bearish catalysts have outweighed the bullish one.
Ethereum ($ETH) token was trading at $1,980, down substantially from its all-time high of $4,960. Technical analysis suggests the coin will likely drop to the key support at $1,500 before hitting the psychological $2,500 level.
Ethereum price technical analysis suggests a retreat to $1,500 is likely
The daily timeframe chart shows that $ETH price remains in a technical bear market after falling by 60% from its all-time high. It is slowly forming a bearish pennant pattern, consisting of a vertical line and a symmetrical triangle.
It has completed forming the flagpole line and is now in the triangle section, whose two lines are about to converge. In most cases, a bearish breakout normally happens when these two lines are about to meet.
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$ETH price has remained below all moving averages and the 78.6% Fibonacci Retracement level. It has also moved below the strong pivot, reverse level of the Murrey Math Lines.
Therefore, the most likely $ETH price prediction is bearish, with the initial target at the psychological $1,500 level, a few points above its lowest level in April last year.
$ETH price chart | Source: crypto.news
The bearish outlook is also supported by a Polymarket poll, which places the odds of it falling to $1,500 this year at 72%.
$ETH price to drop as demand wanes
The main reason why $ETH price may crash to $1,500 first is that demand has remained thin in the past few months. A good example of the waning demand is the ongoing happenings in the futures market, where open interest has dropped to $23 billion, its lowest level since 2024. It has crashed from last year’s high of nearly $70 billion.
Spot Ethereum ETF outflows have continued this month. These funds have shed over $326 million in assets this month, the fourth consecutive month in the red. They have lost over $2 billion in assets in the last four months.
These bearish catalysts have outweighed the positive Ethereum news. For example, the staking queue has jumped to a record high, with the staking ratio hitting the key milestone of 30%.
The supply of $ETH on exchanges has dropped to a record low, while transactions, fees, and active addresses have soared. Ethereum has also become the most preferred chain for the booming real-world asset tokenization industry.
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