The cryptocurrency market is no stranger to volatility, and Ethereum (ETH), as the second-largest digital asset by market capitalization, is no exception. Recently, ETH has rebounded nearly 18% from its weekly lows, sparking speculation: Has Ethereum’s price finally hit rock bottom? While the upward momentum offers a glimmer of hope, several technical and macroeconomic indicators suggest that this rally might not be enough to confirm a sustainable bottom.
In this analysis, we’ll explore three critical reasons why Ethereum could still face further downside pressure — from key resistance levels and RSI signals to broader economic uncertainty. Whether you're a long-term holder or an active trader, understanding these dynamics is essential for navigating the current market landscape.
👉 Discover how market sentiment impacts ETH price movements and what to watch next.
Key Support Levels to Watch: 1,280–1,160 and 715–890 USD
Before diving into the bearish arguments, it's important to identify the critical support zones that could determine Ethereum’s next major move.
Technical analysts have pinpointed two primary demand areas where buying pressure may emerge:
- Intermediate Support Zone: $1,280 – $1,160
This range previously acted as strong support in December 2022. After bouncing from this zone, ETH surged over 40% in just three to four weeks without significant pullbacks. If prices return here, traders will be watching closely for signs of accumulation. - Major Demand Zone: $890 – $715
This deeper level represents a structural imbalance on the weekly chart — a zone where sustained institutional or algorithmic buying could step in. A drop to this range would signal a deeper correction but might also set the stage for a more durable rebound.
However, reaching these supports isn't inevitable — nor is it guaranteed they’ll hold. The path depends heavily on both technical structure and external macro forces.
Reason 1: Weekly Chart Shows Critical Resistance at $1,630
One of the most compelling arguments against a confirmed bottom lies in Ethereum’s weekly chart.
Currently, ETH is approaching $1,630, which marks the highest volume node since February 2021 — a level identified through volume profile analysis on platforms like TradingView. This price point functioned as strong support during the bull run but has now flipped into resistance following the recent breakdown.
For bulls to regain control, Ethereum must not only reclaim $1,630 but close decisively above it with sustained volume. Until then, this level acts as a ceiling that limits upside potential and increases the likelihood of rejection.
Historically, failed retests of former support-turned-resistance often precede further declines. The fact that ETH hasn’t broken past this barrier suggests that selling pressure remains dominant in the medium-term trend.
Moreover, even the current 18% rally off the lows appears weak when viewed through the lens of volume and momentum — characteristics typical of a bear market bounce rather than the start of a new bull phase.
👉 Learn how volume profile analysis can help predict ETH’s next big move.
Reason 2: RSI Has Not Entered Oversold Territory
Another red flag for potential downside comes from the Relative Strength Index (RSI) on the weekly timeframe.
In nearly every major Ethereum bull cycle, sustained rallies began only after the RSI dropped into oversold territory — typically below 30. This condition reflects extreme pessimism and capitulation among holders, often marking the end of intense selling pressure.
Yet currently, the weekly RSI for ETH remains above 30. It hasn’t reached the deeply oversold conditions seen in previous market bottoms like those in 2018, 2020, or even mid-2022.
This means:
- There hasn’t been widespread capitulation.
- Many leveraged long positions may have already been liquidated, but passive holders haven’t been forced to sell at panic prices.
- The market may still need more time — and possibly lower prices — to flush out remaining weak hands.
Without a true emotional bottom signaled by RSI, any recovery should be treated with caution. Markets often "take the stairs up but ride the elevator down," meaning slow recoveries can precede sharp new drops if sentiment shifts again.
Reason 3: Macroeconomic Uncertainty Weighs on Risk Assets
Beyond technicals, broader macroeconomic conditions continue to cast a shadow over risk assets — including cryptocurrencies like Ethereum.
Two key factors are currently driving market anxiety:
1. Escalating Trade Tensions
Global trade disputes have resurfaced, increasing volatility across equity and commodity markets. As geopolitical risks rise, investors tend to retreat from speculative assets like crypto and rotate into safer stores of value such as gold or U.S. Treasuries.
2. Federal Reserve Policy Outlook
This week brings two pivotal events:
- Federal Reserve Chair Jerome Powell’s public remarks
- Release of March’s inflation data
These developments will shape expectations around interest rates and monetary policy tightening. If inflation proves stickier than expected or Powell adopts a hawkish tone, it could trigger another wave of risk-off sentiment — pressuring growth-oriented assets like ETH.
Cryptocurrencies, while decentralized, remain highly correlated with tech stocks and liquidity conditions driven by central banks. In times of tightening financial conditions, capital tends to exit high-beta assets first.
Thus, even if Ethereum’s fundamentals remain strong (e.g., network usage, staking adoption), macro headwinds can suppress prices in the short to medium term.
FAQ: Common Questions About Ethereum’s Price Outlook
Q: Can Ethereum recover without breaking $1,630?
A: A short-term bounce is possible, but a sustainable recovery requires reclaiming $1,630 with strong volume. Without that, resistance will likely cap gains and lead to renewed selling pressure.
Q: Is it safe to buy ETH now at current levels?
A: Only if you're prepared for further downside. With no confirmed bottom and macro uncertainty lingering, dollar-cost averaging may be a safer strategy than lump-sum investing.
Q: What would signal a true market bottom for Ethereum?
A: Look for three things: weekly RSI below 30 (capitulation), a close above key resistance ($1,630), and improving macro conditions (e.g., dovish Fed stance or falling inflation).
Q: How low could Ethereum go?
A: In a worst-case scenario, ETH could test the $715–$890 range. However, such a drop would likely create a high-reward entry point for long-term investors.
Q: Does on-chain activity support a near-term rebound?
A: While network fundamentals remain healthy — with steady usage and growing Layer 2 adoption — on-chain strength doesn’t always align with price action during macro downturns.
Final Thoughts: Stay Cautious Until Signals Align
While Ethereum’s 18% rebound offers temporary relief, it doesn’t confirm a bottom. Three major factors — unbroken resistance at $1,630, absence of RSI oversold conditions, and uncertain macroeconomic conditions — all point to potential further downside.
Traders and investors should monitor:
- Weekly candle closes relative to $1,630
- RSI behavior on higher timeframes
- Upcoming Fed commentary and inflation prints
Until these elements align favorably, caution remains the best strategy.
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