The departure of approximately $170 million from Ethereum (ETH)-based mutual funds in 2022 marks a decline in institutional demand. Crypto analyst Yashu Gola states that ETH faces a 35% probability of price correction in Q2 as it approaches breaking below the ‘ascending triangle’ pattern.
Is Ethereum (ETH) price collapse ahead?
Analyst states that Ethereum price traded around $2,825 on May 2 as it fluctuated between profit and loss, and traders are undecided about the next price target. Interestingly, ETH wobbled near an ascending trendline forming an ascending triangle pattern in conjugation with a horizontal line resistance. The analyst makes the following assessment:
To summarize, ascending triangles are typically continuation patterns. However, Ether’s price was bearish before forming its ascending triangle, raising the chances of a breakout in the next few weeks. Another bearish sign comes from Ether’s fake breakout more than a month ago.
The analyst specifically reminds that ETH broke above its ascending triangle on March 28 and returned to its range only a week later, meaning it was a false breakout. Turning the top of the triangle into resistance followed by a period of consistent selling indicates strengthening of the bearish momentum now approaching a breakout moment.
ETH weekly price chart with ‘ascending triangle’ setup / Source: TradingView Analyst, as a rule, the downside goal of breaking below the lower trendline of the triangle is a length equal to the maximum height of the triangle. He states that he placed it in the area between $1,820 (-35) and $2,160 (-30%) depending on the breakout point.
Institutional ETH outflows flowed into these cryptocurrencies
By the way, as we reported on Kriptokoin.com, according to the latest CoinShares report, accredited investors are withdrawing money from Ethereum-based investment products in 2022. In detail, approximately $169 million had already been reserved from Ethereum funds by April 22. In turn, institutional money from Ethereum flowed to its top rival Bitcoin (BTC), including its rivals Solana (SOL) and Avalanche (AVAX).
Institutional streams as of April 22 / Source: CoinShares Digital Trend, a pseudonymous analyst at Seeking Alpha, believes investors are Ethereum’s blockchain competitors Solana (SOL), Avalanche ( AVAX alleges that Terra (LUNA) and Algorand (ALGO) have repositioned their capital to withdraw funds from Ethereum.
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