Ethereum’s price has been falling, hitting lows around $1,400 – levels not seen since early 2023. This has investors worried, especially since Ethereum is down over 65% from its 2024 high.
Capitulation and a Potential Turnaround
Analyst Ted Pillows believes Ethereum is in a capitulation phase, meaning a final sell-off is likely before a rebound. He predicts one last 5-10% drop might happen, especially considering recent stock market weakness. However, he sees a potential turning point.
The Fed’s Role
Pillows points to a possible shift in the Federal Reserve’s monetary policy as a key factor. If the Fed changes course (maybe cutting interest rates or restarting quantitative easing), it could boost risky assets like Ethereum. Historically, Fed policy changes have had a significant impact on the market.
Recent Price Drops and Market Sentiment
Ethereum’s recent price drop of 20% in just a few hours shows the panic in the market. Investor confidence is low, and the overall market conditions, including trade tensions and recession fears, are contributing to the downturn. The drop below the $1,800 support level further fueled the selling.
A Glimmer of Hope?
While the situation looks bearish, reclaiming the $1,800 level could signal the end of the sell-off and attract buyers back into the market. Until then, Ethereum remains vulnerable, and any price increases will likely be short-lived without broader market improvement or a significant change in the Fed’s approach. The bulls need a quick win to change the momentum.
