Ethereum price has retreated sharply in the past few weeks, joining other cryptocurrencies like Bitcoin, Solana, and Polkadot. The ETH token retreated from a high of $4,100 on March 12th to a low of $3,300.
Strong competition and ETF hopes
Ethereum price has dropped sharply as investors remain concerned about the rising competition in the blockchain industry.
The biggest competition is coming from Solana, the fastest-growing blockchain in the industry. Solana has continued to gain market share in key industries like Decentralized Finance (DeFi) and meme coins.
A closer look at the decentralized exchange (DEX) industry shows that three Solana platforms are doing better than Ethereum’s. Jupiter, Raydium, and Orca are handling more volume than popular Ethereum platforms like Uniswap and Curve.
These Solana DEX platforms are thriving because of the substantial market share by meme coins like Book of Meme, Dogwifhat, and Bonk.
Ethereum price has also retreated because of the rising possibility that the Securities and Exchange Commission (SEC) will not approve a spot ETH ETF. The Fed is concerned that Ethereum is a financial security that should be regulated because of its staking features.
Still, there are signs that the SEC will approve the funds. For one, there have been no problems with the Bitcoin ETFs so far. Also, companies like Blackrock and Franklin Templeton have applied for the ETF. These are some of the most connected companies in the world. Blackrock has even bought $100 million in Ethereum in anticipation that the ETF approval will happen.
The other positive side about Ethereum is that Blackrock has launched a tokenized fund in collaboration with Securitize. This fund has gained over $240 million in assets in the past few weeks. The fund is powered by the Ethereum blockchain, which helps the developers to receive the BUDL tokens.
Ethereum price prediction
The daily chart shows that the ETH price peaked at $4,095 in March and has been in a strong downward trend. It has dropped slightly below the 50-day moving average and the 23.6% Fibonacci Retracement level. In most cases, these are usually negative signs. On the positive sign, Ethereum has remained above the 100-day EMA.
The Relative Strength Index (RSI) has moved from the extremely overbought level of 80 to below 50. Most recently, the attempts to rebound have failed at $3,687.
Therefore, the outlook for Ethereum price is bearish for now, with the next point to watch being at $3,058, the lowest swing on March 20th. A drop below that level will open the possibility of it moving to the 50% retracement at $2,820.
On the other hand, a move above the crucial resistance point at $3,687 will point to more upside as it will open the possibility of it retesting the YTD high of $4,095.
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