Ethereum Price Forms Risky Pattern, Pointing to a 60% Crash as CEX Reserves Jump

Ethereum price has formed a risky chart pattern that points to a 60% plunge in the coming months. This crash will likely happen even as Donald Trump announced plans to include ETH into the US Strategic Crypto Reserve. Further, this drop will likely happen as ETH balances on exchanges rise and ETF outflows soar.

Ethereum Price is at Risk as CEX Exchanges Jumped

ETH price has remained in a technical bear market after falling by over 40% from its highest level in November last year. This sell-off may continue now that the volume of ETH balances on exchanges has continued rising this year.

CoinGlass data shows that these balances soared to 15.5 million on Monday, up from 14.9 million last week. These balances have surged to their highest levels since February 8 of this year.

Rising Ethereum reserves on exchanges is a sign that investors are moving their coins from self-custody to exchanges to sell. 

One sign that this is happening is that spot Ethereum ETFs have continued to see substantial outflows. The chart below shows that these funds have had outflows in the past seven straight days. They lost over $355 million in assets in this period, bringing their cumulative net inflow at $2.82 billion.

ETH Price Triple-Top Pattern Points to a Big Crash

These Ethereum headwinds mean that it may remain under pressure for a while. The weekly chart shows that the ETH coin formed a triple-top chart pattern around the $4,000 resistance level. 

This chart pattern is made of three peaks and a neckline. ETH hit the initial peak in March 2024. It then moved closer to that resistance level in May, and retested it again in November last year. That resistance is a sign that the bulls were afraid to place buy trades above that price. 

Ethereum price has now crashed to the triple-top’s neckline at $2,156, its lowest level in September last year. It has also plunged below the major S/R pivot point of the Murrey Math Lines tool at $2,500, and the 50-week moving average. These are all signs that bears are now in control.

Etherem Target Prices

The most likely scenario is where the Ethereum price continues its strong bearish breakdown, with the next viable target being at $880, its lowest level in June 2022, which is about 60% from the current level. This target is at the oversold level of the Murrey Math Lines level. 

On the flip side, the bearish ETH price forecast will be invalidated if it rises above the top of the trading range at $2,800. 

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crispus

Crispus is a seasoned Financial Analyst at CoinGape with over 12 years of experience. He focuses on Bitcoin and other altcoins, covering the intersection of news and analysis. His insights have been featured on renowned platforms such as BanklessTimes, CoinJournal, HypeIndex, SeekingAlpha, Forbes, InvestingCube, Investing.com, and MoneyTransfers.com.

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.