Bitcoin and Ethereum Price Prediction as BTC Drops Lower and ETH Takes a Hit – Time to Buy the Dip

Arslan Butt
Last updated: | 3 min read

In the dynamic world of cryptocurrencies, Bitcoin (BTC) and Ethereum (ETH) are facing pivotal moments. Bitcoin, the most prominent cryptocurrency, has witnessed a continual downward trajectory, plunging to the $41,000 threshold on Monday.

The entire global crypto market cap reflects this downturn, showing a 1.65% loss in the last 24 hours, settling at $1.62 trillion. Despite consolidating at $41,000 over the weekend, the market remains in a tug-of-war between bulls and bears, creating a state of uncertainty.

Ethereum, on the other hand, is hovering around $2,350, a precarious position given its recent inability to breach the $2,500 level.  Amidst these fluctuations, the crypto market is also reacting to recent developments such as Grayscale’s substantial Bitcoin sell-off and the impact of Bitcoin and Ethereum ETF approvals.

These events are significantly influencing market dynamics, adding layers of complexity to the already intricate crypto trading environment.

 

ETF Approval: Impact on Bitcoin & Ethereum Flows


The recent approval of a Bitcoin spot ETF has notably triggered selling pressure, leading to modest outflows totaling $21 million in cryptocurrency products.

Specifically, Bitcoin and Ethereum experienced the largest outflows, amounting to $24.7 million and $13.6 million, respectively.

In contrast, the Bitcoin Short fund, which profits from BTC’s decline, saw an inflow of $12.7 million.

In the meantime, the altcoins faced challenges, with Litecoin losing $1.5 million and Solana experiencing an $8.5 million outflow.

In terms of regional trends, Canada and Germany had significant outflows, while the USA and Brazil attracted inflows, with the USA leading at $263.2 million. Therefore, the news of outflows in Bitcoin and Ethereum, coupled with the surge in trading volumes, likely contributed to selling pressure.

However, the impact on BTC price depends on various factors, including market sentiment and external events.

Grayscale’s $2.14B Bitcoin Sale


The recent slowdown in cryptocurrency market momentum can partly be attributed to Grayscale, a prominent digital asset manager, offloading approximately $2.14 billion worth of Bitcoin, totaling about 52,227 BTC.

This significant sale occurred in the wake of the approval of a Bitcoin ETF, a pivotal development in the financial integration of cryptocurrencies. Other major players like BlackRock’s iShares, Fidelity, and Bitwise also hold substantial amounts of Bitcoin.

Grayscale’s sell-off had a impact on Bitcoin prices, causing a temporary setback. However, the overall market context suggests that the fundamental drivers of the bull market, like growing crypto adoption and institutional interest, remain strong.

Bitcoin has a history of bouncing back from corrections, and the market is likely to recover once the immediate impact subsides.

Hence, Grayscale’s massive Bitcoin sell-off, totaling $2.14 billion, triggered a swift dip in BTC prices. Despite this setback, the market’s fundamentals, driven by increasing adoption and institutional interest, suggest a potential recovery.

Bitcoin Price Prediction

Bitcoin’s price struggles as it breaches key support at $40,600, signaling a bearish momentum. The current pivot point at $41,790 offers little relief, with the cryptocurrency trading around $39,975. Resistance levels now loom at $41,859 and $41,791, challenging any potential recovery.

The 50 EMA at $41,859 and the downward-sloping RSI at 37.88 reinforce the strength of the bearish trend. Moreover, the RSI lingering below the 50 mark suggests a lack of buying momentum.

Bitcoin Price Chart - Source: Tradingview
Bitcoin Price Chart – Source: Tradingview

The break below the double bottom pattern around $40,632 adds to the negative outlook, indicating that sellers are in control and may push prices towards the next support at $38,351. Investors should watch if the price can reclaim the pivot level to mitigate the bearish pressure.

Ethereum Price Prediction

Ethereum’s market sentiment falters as it trades at $2,338.9, with the 4-hour chart showing a pivotal resistance at the EMA 50 line of $2,457.1. The RSI, at a modest 35.25, hints at potential oversold conditions, yet the break below the $2,475.3 support level raises concerns for further declines.

Immediate resistance is set near $2,531.7, challenging upward movements.

Ethereum Price Chart
Ethereum Price Chart – Source: Tradingview

Should bears maintain control, Ethereum could test further support at $2,301.9. Investors should watch for the RSI to rebound from oversold territory, which may signal a short-term relief rally, while a continued hold below the EMA 50 could see the downtrend persist.

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