Market Volatility Hits Ether Hard
Ether (ETH) has recently plunged to levels not witnessed since November 2023, as the cryptocurrency market grapples with ongoing volatility. This turbulence is primarily fueled by concerns surrounding U.S. President Donald Trump’s trade war threats, which have sent shockwaves through global financial markets.
Significant Decline in Price
In the last 24 hours, ETH has experienced a staggering 15% decrease, as reported by CoinDesk Indices. This downward trend has not only affected Ether but has also dragged down the CoinDesk 20 index, which tracks the performance of the largest digital assets and has seen a decline of 16% during the same period.
Factors Contributing to Ether’s Downturn
The past three months have been particularly challenging for Ether, which has struggled to keep pace with Bitcoin (BTC). This underperformance is attributed to several factors, including:
- Bearish Investor Sentiment: A growing lack of confidence among investors has led to increased selling pressure.
- Weak Institutional Demand: A decline in institutional interest has contributed to the overall bearish trend.
- Macroeconomic Headwinds: Ongoing fears related to trade wars, inflation, and a weakening stock market have discouraged risk-taking among investors.
Liquidation Events and Market Predictions
Recent data from CoinGlass indicates that nearly $165 million in long positions for ETH were liquidated within the last 12 hours. This significant liquidation highlights the challenges faced by traders in this turbulent market environment.
Looking ahead, bettors on Polymarket are forecasting a 76% probability that Ether will rebound to $1,900 by the end of the month, suggesting some level of optimism despite the current downturn.
ETF Outflows Indicate Weakness
The situation is further exacerbated by substantial outflows from Ether exchange-traded funds (ETFs). According to data from SoSoValue, last week saw a staggering outflow of -$335 million, indicating a significant decline in investor confidence and participation in Ether-related investment vehicles.
Conclusion
The current state of Ether reflects a broader trend of uncertainty in the cryptocurrency market, impacted by macroeconomic factors and investor sentiment. As traders watch closely for signs of recovery, the coming weeks will be crucial in determining whether Ether can stabilize and regain its footing above the $2,000 mark.
