ETH/USD Weekly Chart (Bitstamp) – Source: TradingView
The last two times this happened, ETH went on to lose 49% (May 2022) and 37% (February 2025). The price has already broken below this key EMA recently and has retested this line from below multiple times as well.
Failing to recapture that zone could result in a heavy loss of around 40% for ETH in the next few weeks as the token will likely retest the $1,600 support. This means we will be back near April’s lows, even though macroeconomic conditions are entirely different.
The price has to drop below $2,800 to confirm this bearish outlook, as this would result in a move below a key structural support. We could also expect that, if the price stays above $2,800, ETH could retest the $3,900 before a final distribution to the lows mentioned earlier.
It would not be a bad idea to downsize long positions if ETH recovers to $3,900 at some point, as the state of the market seems fragile at the moment. If the market distributes right after tagging that key resistance, there will be a chance to buy ETH back at a much more attractive price.
The Relative Strength Index (RSI) also favors a bearish outlook as it has dropped below the 14-day moving average, indicating a change in the trend’s direction. Moreover, the oscillator has declined below the mid-line, reflecting that negative momentum is strong and accelerating.