Ethereum is on the verge of a significant price decline, according to a recent technical analysis by Alan Santana, a well-known crypto analyst. Santana forecasts that Ethereum will reach a price of $2,000 within a few days or weeks, advising investors to brace for the impending decline.
The analyst points out that Ethereum has been drooping for six weeks straight, yet many investors are still waiting for new highs. Santana presents a compelling five-step sequence that draws parallels between the current market situation and the events that unfolded in November 2021.
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From All-Time High to Bearish Momentum
In early November 2021, Ethereum reached a new all-time high (ATH) but immediately turned red, signaling a potential reversal. Santana emphasizes that while the market is at its most bullish when hitting a new ATH, it also opens up the highest bearish potential.
He notes that the best time to sell is when prices are trading high and near resistance, as waiting for full confirmation from the market often leads to missed opportunities.
Fast forward to early March 2024, Ethereum once again produced a peak, reaching a multi-year high before turning red and starting to drop with bearish momentum growing last week. This pattern closely resembles the events that followed the November 2021 ATH.
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Ethereum EMA10 Breakdown Confirms Top Is In
Following the November 2021 ATH, Ethereum dropped below the 10-week exponential moving average (EMA10) as it turned red. The break and close below EMA10 confirmed that the top was in, and a new bearish wave had begun, leading to the “first drop.” Similarly, last week, on April 8, 2024, Ethereum moved below the EMA10 on the weekly timeframe, confirming that the top is once again in.
Following the top confirmation, Santana now anticipates the “first drop,” which could lead to a target range of approximately $2,222 to $2,400. A dead-cat bounce, a temporary recovery in a declining trend, may follow this drop, ultimately leading to a lower low and a bearish impulse.
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The analyst suggests that the major flush could reach $2,000, around the 200-week moving average (MA200), which is considered a significant support level. While the price could potentially go lower, Santana identifies this as the key support area to watch.