Ethereum's price has declined for three consecutive days, forming a death cross pattern and risking a drop to $1,500.
Current Issues Facing Ethereum
Ethereum fell to $2,430 on Wednesday, down more than 40% from its highest level in November. Key factors include slowed inflows to exchange-traded funds and challenges within the ecosystem. Data from TokenTerminal indicates that fees generated by the network have decreased, earning $9.8 million last week compared to last year's peak of over $217 million.
Decline in DeFi Dominance
Ethereum's position in decentralized finance has weakened, with the total value locked dropping 12.5% in the past 30 days to $54.32 billion. Meanwhile, the stablecoin market capitalization has risen to $121 billion. Ethereum has also lost market share to its layer-2 networks, including Base, Arbitrum, and Optimism, which process substantial transaction volumes.
Technical Analysis: Price Dip Threat
The technical analysis shows that Ethereum has formed a series of lower lows and lower highs. The price fell from $4,000 in November to $2,400, forming a death cross pattern. Ethereum has also fallen below the 61.8% Fibonacci retracement level, a zone where pullbacks typically occur. If it falls below the current support level of $2,130, a further dip to $1,530 is possible.
Current price dynamics and technical indicators suggest the potential for Ethereum's price to fall further to $1,500.
