Ethereum, 'Sell' Tsunami as Ascending Triangle Breaks... $1,350 Fall Warning ON

▲ Ethereum (ETH)

An analysis suggests that Ethereum (ETH) has a higher chance of a bearish breakdown as it has broken out of an ascending triangle structure that has persisted for several months. The confluence of its price staying below key moving averages and limited price rebound in the derivatives market even after long position liquidations indicates an increase in short-term price pressure.

The Crypto Basic reported on May 20 (local time), citing market projections from CryptoQuant verified author Pelin Ay, that Ethereum has confirmed a bearish breakdown and there is a possibility of further decline. Pelin Ay analyzed that Ethereum's recent price movement has weakened, falling below the key ascending triangle pattern it had formed since early February.

Ethereum recently broke its lower support line during its recent decline, falling to $2,077 on Monday before showing a brief recovery. However, after this breakdown, market sentiment has shifted towards selling pressure, and it was diagnosed that price pressure could continue if an immediate recovery does not occur.

Currently, Ethereum is trading around $2,124, showing little change over a 24-hour period. However, it is significantly below both its 200-day moving average of $2,576 and its 137-day moving average of $2,337. Both moving averages have started to curve downwards, interpreted as a signal that overall market momentum is weakening.

Short-term averages also remain below long-term trend lines. This structure suggests that buyers have not yet regained market dominance, and upward attempts are limited to short-term rebounds without securing sufficient momentum. Pelin Ay believes that if Ethereum fails to recover the broken triangle structure and key moving averages, the outlook remains strongly bearish. He suggested the next major support level at $1,350, which represents a 36% drop from the current price.

Binance liquidation data was also presented as a signal supporting the bearish outlook. Pelin Ay explained that this indicator is important because a significant portion of Ethereum's derivatives trading volume comes from Binance. Recently, despite several surges in long position liquidations as Ethereum failed to maintain an upward trend, no significant price rebound occurred after large-scale derivatives liquidations. Instead, the price continued its downward trajectory, and bullish positions were further liquidated.

A separate analysis by Ali Martinez confirmed the same trend. He stated that approximately 60 whale addresses holding over 10,000 ETH have either completely emptied or significantly reduced their holdings over the past two months. The Crypto Basic reported that the decrease in Ethereum whale numbers and large inflows to exchanges indicate strong recent selling pressure.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*