Ethereum Dropping, Are Investors Re-balancing Portfolios Ahead of Spot ETH ETF Launch?

Ethereum is inching lower, approaching $3,700. Even so, bulls are optimistic, expecting the coin to breach $4,100 in the coming months

Dalmas Ngetich•Friday, May 31, 2024•1 min read

Ethereum is waving lower at press time. Even though the pace of this draw down is low, prices trending above a key support line is all-important. In the short term, buyers still have the upper hand, even presenting an opportunity for traders to double down on dips, expecting more gains. As things stand, traders can expect a recovery, though losses below $3,700 will likely slow down the uptrend.

From events in the daily chart, the state of price action means there is weakness across the board, though buyers might also be taking this chance to accumulate. Ethereum prices are stable on the last day but down 2% in the previous week of trading. With the coin printing lower lows, engagement is also falling, down to over $13 billion in the past 24 hours.

Ethereum daily chart for May 31

The following Ethereum news events are worth watching:

Analysts speculate that ETH prices are stuck at current ranges because investors are actively reallocating capital. BlackRock recently filed an updated S-1 registration form for their spot Ethereum ETFs mid-this week. The product will be a game-changer for ETH and the broader crypto ecosystem.
Shibarium developers are actively building. In a recent post, their action has seen bridge time drastically reduced. This means developing and deploying time-sensitive dApps is faster than before.

Ethereum Price Analysis

The path of least resistance remains northwards.

Even so, ETH/USD is tracking lower, albeit with relatively low trading volume.

Buyers remain in charge as long as Ethereum is trading above $3,700.

Conservative traders can wait for a breakout above $3,900 for a chance to load, targeting $4,100 or an aggressive drop below $3,700 to ride with the emerging short-term trend. In that case, ETH might drop to $3,500 and $3,300.

The decision to wait for trend definition can pay off for now.

Further gains above $4,100 will propel ETH to all-time highs.