Ethereum Faces 14% Drop Risk as Selling Pressure Persists

Ethereum is currently facing a challenging market environment, with technical indicators suggesting a potential sharp decline in its price. Despite recent attempts at recovery, the broader market structure remains bearish, with sellers maintaining control. A technical analysis by crypto analyst Youriverse on the TradingView platform indicates that if the current downward trend persists, Ethereum's price could drop to as low as $1,400.

The Ethereum price chart on the 4-hour timeframe shows a significant Fair Value Gap (FVG) resulting from a steep 10% drop last Sunday. This gap represents an area of strong seller dominance, where selling activity has outweighed buying pressure over the past week. Ethereum's price has retraced into this gap multiple times, each time facing swift rejection, indicating intense selling pressure within this zone.

Currently, Ethereum is trading within the "golden pocket" of the Fibonacci extension indicator, drawn from the $1,383 bottom on April 9. Unless the price decisively breaks above this level and moves toward the next Fibonacci level of 0.786 at $1,724, there is a risk of significant rejection that could lead to further downside below $1,400. The Stochastic RSI, a momentum oscillator measuring the relative strength of recent price movements, is approaching the overbought region on the daily timeframe. This adds another layer of bearish pressure, as Ethereum's price has been pushed from the $1,383 bottom on April 9, and the Stochastic RSI moving into the overbought zone suggests a potential rejection at the Fair Value Gap and a new downside correction.

Ethereum's price was recently rejected at $1,650, further supporting the bearish continuation thesis. If selling pressure builds again, as indicated by the weakening RSI and persistent resistance at the Fair Value Gap, the price could break down to as low as $1,400 or even lower. At the time of writing, Ethereum is trading at $1,627.

In summary, Ethereum's price is threatened with a sharp drop to $1,400 due to persistent selling pressure within the Fair Value Gap and bearish indicators such as the Stochastic RSI. Unless the price breaks decisively above the current resistance levels, the risk of further downside remains significant.