Ethereum is under bearish pressure, exhibiting a bear flag pattern on the daily chart. This is accompanied by decreasing transaction fees and network activity.
Ethereum's Network Activity Slumps
The recent drop in Ethereum's price is influenced by a host of factors, including tariff threats from US President Donald Trump. Since January, the price has plummeted by nearly 50%, hitting $1,750 in March. Despite a subsequent 18% rebound, Ethereum failed twice to decisively break above $2,000 within the last ten days.
ETH Supply Inflation Returns
Decreased transaction fees have led to a decline in the daily ETH burn rate, causing an inflationary trend. This results in increased ETH issuance, reverting the deflationary status post Proof-of-Stake transition (the Merge).
Ether’s Bear Flag Targets $1,230
The bear flag pattern on the daily chart indicates a potential continuation of the downward trend. A daily close below $2,000 could target a drop to $1,230. Analysts, however, note a possible return to support at $2,200, which would signify a major deviation.
The current situation in the Ethereum market requires close observation of market changes. Despite bearish signals, market dynamics could shift if network activity recovers.
