Ethereum Price Declines Following Fed's Hawkish Decision
ETH All-Time High in 2025? Here’s Why!
Ethereum's (ETH) recent 6% dip after the Federal Reserve's hawkish stance has raised concerns about its near-term trajectory. Investors are now eyeing ETH price prediction to assess its recovery potential and chances of breaking key resistance levels.
Why Did Ethereum Drop by 6%?
On December 18, the Federal Reserve announced a 25-basis-point rate cut and signaled it would reduce the frequency of cuts in 2025. This hawkish decision sent shockwaves through the crypto market, resulting in a $102 million liquidation of ETH futures.
Key Stats:
Liquidations: $90.74 million in longs, $12.16 million in shorts
Weighted Sentiment: Dropped to levels last seen in December 2023
Weighted Sentiment, a metric combining social volume and market sentiment, suggests bearish sentiment when high social volume meets negative market sentiment. Despite the negative outlook, historical data indicates prices often recover after such dips.
Also Read: TAO Price Prediction 2024 - 2030
Ethereum’s Struggle to Break $4,000
Ethereum’s yearly high resistance at $4,093 has been a significant hurdle. Even during the ongoing crypto bull run, ETH has failed to sustain upward momentum, underperforming compared to Bitcoin.
Bitcoin’s Performance: Consistent all-time highs, monthly gains of 5%
Ethereum’s Performance: Weekly gains of 2.3%, still below $4,000
Bullish Developments in the Ethereum Ecosystem
Despite ETH’s sluggish price movement, the ecosystem has seen notable advancements:
Deutsche Bank Partnership: Germany’s largest lender is developing its own Layer-2 blockchain on Ethereum using ZKsync technology.
ETF Inflows: Ethereum ETFs recorded $144.7 million in net inflows this week, marking 17 consecutive days of growth. BlackRock’s iShares Ethereum Trust now holds over 1 million ETH.
Bearish Signals to Watch Out For
Technical indicators suggest a potential short-term correction for Ethereum.
Chart Patterns: Bearish double top with RSI divergence
MACD Crossover: Confirms a downward trend
Price Predictions: ETH could drop to $3,400, with support levels at $3,200 and $3,000.
Ethereum Price Prediction for 2024, 2025, and Beyond
While ETH faces near-term challenges, its long-term outlook remains optimistic, supported by strong accumulation from long-term holders and continued institutional interest.
Long-Term Holders (LTH): LTHs now control 90% of Ethereum’s circulating supply, totaling 110 million ETH.
ETF Inflows: Over $2.46 billion in cumulative inflows since November 2024.
Ethereum Price Predictions
2024: Recovery to $4,000+ possible if accumulation and ETF inflows continue.
2025: With macroeconomic stability, ETH could aim for a new all-time high of $4,900.
2030: Bullish scenarios place ETH’s price above $10,000, driven by widespread adoption and Ethereum 2.0 scalability.
Will Ethereum Go Up?
ETH’s ability to break the $4,000 resistance will depend on multiple factors:
Market Sentiment: Improvement in Weighted Sentiment could trigger a rebound.
Institutional Support: Continued ETF inflows and LTH accumulation provide a bullish foundation.
Technical Breakout: Overcoming $4,093 could signal the next leg up.
Key Takeaways
Current Price: ETH trades around $3,600 after a 6% drop.
Resistance Level: $4,093 remains the critical barrier.
Support Levels: $3,400, $3,200, and $3,000.
ETFs & LTH Support: Strong institutional interest and accumulation indicate long-term potential.
Actionable Insight: For investors, the $3,400-$3,000 range could present a buying opportunity if bearish patterns play out. Meanwhile, those holding long-term may see Ethereum’s price rebound as positive market drivers take hold.
Ethereum’s future looks promising, but patience is key. With strong fundamentals and continued adoption, ETH remains a compelling choice for long-term investors.