Ethereum Price Crash Likely After $45M ETH Selloff, Weak US Jobs Report

Ethereum price today trades at $2,368. Ether bulls are attempting a recovery rally as the US Nonfarm Payrolls (NFP) came in below expectations. The recent Bitcoin crash has pushed the smart contract token to slide below the two key support levels. Investors speculate on whether ETH will crash lower or rally higher.

Can US Nonfarm Payrolls Prevent Ethereum Price From Bearish Outlook?

The revised data shows the US added 25,000 fewer jobs in August, from 114K to 89K. Although this data point is not bullish, traders are pricing in a 50% chance of a 50 basis point rate cut in September. Hence, investors are looking to trade the Ethereum price, which currently trades around $2,400 and anticipates a retest of $2,548.

One reason traders are bullish despite the lower jobs data is the decline in the US unemployment rate from 4.3% in July to 4.2%. This downtick marks the lowest level since June this year and the first decline after four consecutive months of increases. 

Hence, the next few days leading up to the Federal Reserve’s rate cut decision on September 18 are likely to remain bullish. However, investors must be cautious as Bitcoin shows signs of exhaustion and could extend the ongoing downtrend, ruining ETH’s optimism. 

Can ETH Bulls Sustain $43 Million Selling Pressure?

According to data from Lookonchain, three hackers sent 17,800 ETH worth $42 million to Tornado Cash, a popular cryptocurrency mixer. Ideally, transfers from hackers into crypto mixers like Tornado Cash often mix the tainted or hacked funds so they can be sold. 

3 Hackers deposited 17,800 $ETH($42.7M) into https://t.co/11PfRBP2j2 in the past 3 days!#Penpiexyz Exploiter deposited 9,600 $ETH($23M) to https://t.co/11PfRBP2j2.#WazirX Exploiter deposited 7,200 $ETH($17.3M) to https://t.co/11PfRBP2j2.

The hacker who stole $42M from… pic.twitter.com/4RK63VfrCL

— Lookonchain (@lookonchain) September 6, 2024

To make matters worse, the Ethereum Foundation, the entity behind Ether, also deposited 1,000 ETH worth $2.3 million to a multi-signature wallet. History shows that such a transfer was often followed by converting the ETH to DAI, an ETH-based stablecoin. 

Ethereum Price Attempts Short-term Recovery 

Ethereum price prediction hints at a weak outlook as ETH recently flipped two key levels on the daily time frame: 

1. The yearly Volume Weighted Average Price’s (VWAP) lower limit of $2,583 
2. A key support level of $2,548. 

Since both these levels coincide, a breakdown suggests a surge in bearish momentum and a lack of buying pressure. The weak US Nonfarm Payrolls report, selling pressure from hackers, the Ethereum Foundation’s transfer of ETH to centralized exchanges, and Vitalik Buterin selling ETH have all prevented the smart contract token from scaling higher. 

The Relative Strength Index (RSI) and Awesome Oscillator (AO) showed waning bearish momentum from mid-August to early September. However, the bulls have failed to seize control since the start of the new month, and this is noticeable not just in the indicators but also in the price action. 

If this outlook continues, investors can expect ETH to trigger a short-term correction to the intermediate support level of $2,252. Sidelined buyers’ intervention here is key. If these investors fail to show up, then the next critical level that bulls could show up is the $2,000 psychological level.

On the other hand, a bounce from $2,252 or a sudden spike in buying pressure that propels Bitcoin higher could help invalidate Ethereum’s bearish outlook. In such a case, if ETH price manages to flip the $2,548 and $2,582 resistance level into a support floor, it would attract investors. Such a development could see Ether attempt a recovery rally to $3,000.

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Akash Girimath

Akash Girimath is an engineer at core, but is interested in the chaos of the financial markets. Akash is senior report and analyst who also trades cryptos on a regular basis and maintains a small crypto fund for friends and family.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.