The largest meme coin by market value, Ethereum (ETH), is trading at $3,300, and the BTC decline has affected it as well. Normally, with only days left for the Spot ETH ETF listing, investors did not expect such a scenario. So, what is the reason for the weakness in Ethereum’s price performance? What awaits investors? Why did Ether drop?
Why Did Ethereum (ETH) Drop?
ETH price has fallen to $3,280, experiencing one of its worst days in a three-week period. The decline in Bitcoin price also brought a drop for ETH. There has been a massive potential for sales for BTC that we have been discussing for a long time. Rumors that MTGOX creditors have started to receive their funds back have triggered negativity in the markets.
Although there is no BTC movement in wallets linked to the MTGOX incident, it is curious how this rumor is being received in the market. The announcement that refunds would start in July has been the reason for the negativity that has continued for over 10 days.
Charles Edwards, the founder of Capriole Investments, supported the news by mentioning that 10-year BTC assets were largely moved as of July 2, indicating that the distribution had started.
On the other hand, according to a CoinShares report, we are seeing the largest weekly outflows from Ethereum funds in the last 2 years. Such large outflows on the eve of ETF listing indicate that institutions expect further declines.
CoinShares researcher James Butterfill wrote in his assessment on this matter:
“Ether has seen the largest outflows since August 2022, totaling $61 million, and the outflows in the last two weeks have reached $119 million. In terms of net outflows, we have not seen a worse performance period throughout 2024.”
Solana, on the other hand, saw net inflows again, which was related to the recent VanEck and 21Shares SOL Spot ETF applications.
ETH Price Prediction
So, when will the ETH price rise? The ongoing pullback began after testing the resistance, which includes the 200-4H exponential moving average (200-4H EMA; blue wave) and the upper trend line of the dominant descending channel pattern. The possible support point for price recovery is $3,260, and now ETH is finding buyers at $3,310 above this level.
The final submission date for the S-1 Form for ETH ETF applications was announced as July 8, and next week the SEC may surprisingly approve the ETF listings. So, if we are to see a rise, it will likely be triggered by the SEC’s approval next week or by seeing strong initial inflows (maybe outflows?) in the first few days. The first targets will be $3,413 and $3,475.
