Ethereum price declined to a critical support level as cryptocurrencies experienced a sharp pullback following the Federal Reserve’s hawkish interest rate announcement.
Ethereum (ETH) slipped to $3,540, marking a 10% drop from its peak earlier this week. This retreat coincided with the sell-off of other coins like Bitcoin (BTC) and Solana (SOL).
Despite the price drop, Ethereum’s fundamentals remain strong. Notably, Ethereum Exchange-Traded Funds have seen steady inflows, now totaling over $2.46 billion. These inflows have increased for 18 consecutive days, reflecting growing interest from investors.
Ethereum ETFs are gaining traction as investors anticipate the SEC may soon allow staking within these funds. Currently, the absence of staking options has likely deterred some institutional investors from fully embracing these ETFs
Funds by companies like Grayscale, Blackrock, Fidelity, Bitwise, and VanEck are the biggest holders of Ethereum.
Meanwhile, the number of staked ETH coins has continued rising. There are now over 54.7 million ETH tokens, are now staked, supported by a growing base of more than 206,000 unique stakers. This trend underscores long-term bullish sentiment among investors who plan to hold their ETH positions.
Ethereum is still the biggest player in the blockchain industry, with the total value locked in its Decentralized Finance ecosystem rising to over $73.7 billion. These funds are much higher than most other chains like Solana, Base, and Arbitrum, combined.
ETH retreated after the Federal Reserve slashed interest rates and maintained a hawkish tone. It now expects to cut rates two times instead of four in 2025. Cryptocurrencies and other risky assets do well when the Fed has embraced a dovish tone.
Ethereum price analysis
The daily ETH chart reveals a sharp reversal after the price reached $4,090, a critical resistance level. This level corresponds to the December 6 and March 11 highs, as well as the extreme overshoot level on the Murrey Math Lines.
Ethereum has formed a bearish double-top pattern at this resistance, with its neckline positioned at $3,526. This pattern signals potential further declines, with ETH possibly testing the major support and resistance pivot point at $3,125. More gains will be confirmed if Ethereum rises above the resistance level at $4,090.
