Why Ethereums Price is Declining and Could an Approved ETH ETF Spark a Turnaround
Ethereum Finds Itself in a Challenging Position as Price Hits a Low
The price of Ethereum has plummeted to a severe low of $2,875, experiencing a sharp decline of over 10.2% in just 24 hours. This month is of utmost importance for Ethereum, with reports suggesting the launch of Spot Ethereum ETFs in July 2024.
In May, the US Securities and Exchange Commission (SEC) granted approval for nearly eight spot Ethereum ETF applications. In light of this development, could the launch of these ETFs serve as a remedy for the ongoing decline in the price of Ether? Let’s delve deeper into the possibilities and analyze the situation.
Current State of the Ethereum Market
Sellers have taken control of the Ethereum market, resulting in the price dropping to as low as $2,875. Only a couple of days ago, the price of ETH was around $3,439. This week, the market has experienced extreme volatility, with the price fluctuating between $3,500 and $2,700.
The market has witnessed a significant drop of nearly 16.3% this week alone. It is worth noting that on June 5th last month, the price of Ethereum was approximately $3,864. Over the past 30 days, the price has fallen by more than 24.1%. The yearly peak for Ethereum occurred in mid-March, reaching around $4,065.
Ethereum’s Performance Resembles Bitcoin’s Journey
The performance of Ethereum in 2024 bears a resemblance to Bitcoin’s trajectory. Both cryptocurrencies reached their yearly peaks in mid-March, experienced a subsequent weakening, and have faced volatility in recent months, including a steep decline in the past few days.
Key Points to Remember About Ethereum’s Historic Trend
A week before the SEC approved the spot ETH ETF applications on May 23rd, the price of Ethereum had already begun a vigorous ascent. During that week, the daily chart displayed at least three long green candlesticks, with the longest one forming on May 20th, causing the price to surge from $3,071 to $3,661 in a single day. The buying pressure seen during that week persisted until early June. However, since June 6th, sellers have gradually increased their dominance in the market.
Analyzing the Impact of Bitcoin’s Spot ETF Launch
On January 10th, 2024, the US SEC approved the first eleven Bitcoin spot ETFs. Let’s examine how the Bitcoin market reacted to this approval. The launch did not yield an immediate response in the market, as the price fluctuated between $47,018 and $42,900 in the week leading up to the launch. On January 10th, the price stood at approximately $46,689, slightly lower than the peak of that week.
In the week following the launch, the price experienced a few minor drops, ranging between $46,700 and $41,700. However, almost a month after the launch, Bitcoin encountered strong buying pressure, driving the price from a low of $42,576 to a high of $73,136 within a month.
Based on the data presented above, there is sufficient evidence to suggest that the launch of an Ethereum Spot ETF could have a significant impact on the market. However, it may take at least a month to observe any visible momentum in the charts.
Conclusion
The current situation for Ethereum is challenging, with the price reaching a new low. The launch of Spot Ethereum ETFs in July 2024 holds promise for potentially reversing this downward trend. Investors and enthusiasts eagerly await the impact of this development on the market. Stay tuned to Coinpedia for the latest updates on the Ethereum price journey.