ethereum price fell to a critical support level as the cryptocurrency saw a sharp pullback following the Federal Reserve's aggressive interest rate announcement.
ethereum (eth) fell to $3,540, marking a 10% drop from its peak earlier this week. This pullback coincided with the massive sell-off of other coins such as bitcoin (btc) and Solana (SOL).
Despite the price drop, ethereum's fundamentals remain strong. In particular, ethereum exchange-traded funds have seen steady inflows, now totaling over $2.46 billion. These inflows have increased for 18 consecutive days, reflecting growing investor interest.
ethereum ETFs are gaining traction as investors anticipate that the SEC will soon allow staking within these funds. Currently, the lack of participation options has likely deterred some institutional investors from fully adopting these ETFs.
Funds from companies such as Grayscale, Blackrock, Fidelity, Bitwise and VanEck are the largest holders of ethereum.
Meanwhile, the number of eth coins staked has continued to increase. They're already over <a target="_blank" href="https://app.intotheblock.com/coin/eth/deep-dive?group=network&chart=staking” target=”_blank” rel=”nofollow”>54.7 million eth tokensare now wagered, backed by a growing base of over 206,000 unique bettors. This trend underlines the long-term bullish sentiment among investors who plan to hold their positions in eth.
<img loading="lazy" decoding="async" width="1200" height="800" src="https://crypto.news/app/uploads/2024/12/eth-staked.png” alt=”Cumulative eth sent to stake”/>
ethereum remains the largest player in the blockchain industry, with the total value locked in its Decentralized Finance ecosystem amounting to more than $73.7 billion. These funds are much higher than most other chains like Solana, Base and Arbitrum combined.
eth retreated after the Federal Reserve cut interest rates and maintained a hawkish tone. It now expects to cut rates twice instead of four times in 2025. Cryptocurrencies and other risk assets do well when the Federal Reserve takes a dovish tone.
ethereum Price Analysis
<img loading="lazy" decoding="async" width="3574" height="1982" src="https://crypto.news/app/uploads/2024/12/ethereum-Price-2.png” alt=”ethereum price”/>
The daily chart of eth reveals a strong reversal after the price reached $4,090, a critical resistance level. This level corresponds to the highs of December 6 and March 11, as well as the extreme overshoot level in the Murrey Math Lines.
ethereum has formed a bearish double top pattern at this resistance, with its neckline positioned at $3,526. This pattern indicates possible further declines, with eth possibly testing the main support and resistance pivot point at $3,125. More gains will be confirmed if ethereum breaks the $4,090 resistance level.
