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Ethereum Price Dips Below $3,000 as Grayscale Withdraws ETH ETF Application – More Downside Likely

Last Updated May 8, 2024 12:57 PM
Nikola Lazic
Last Updated May 8, 2024 12:57 PM
By Nikola Lazic
Verified by Peter Henn

Key Takeaways

  • Grayscale withdrew its Ethereum futures ETF application amid regulatory concerns.
  • The SEC’s decision on VanEck’s spot Ethereum ETF is due by May 23.
  • Ethereum price is fluctuating within a descending triangle pattern.

Grayscale recently withdrew its application for an Ethereum futures ETF, while the countdown for spot ETH ETF approvals continues. This move has confused investors, because Grayscale first filed for this ETF in September but have delayed it multiple times since. 

Meanwhile, Ethereum’s price dipped below $3,000, moving downwards from a high of $3,200 on May 6. As the price is in a larger descending triangle, will this spark further depreciation?

Why Did Grayscale Withdraw the Ethereum ETF Application? 

Speculation suggests this withdrawal might be a strategic attempt to protect Grayscale’s spot Ethereum ETF application from rejection. In an tweet, Bloomberg ETF analyst James Seyffart  expressed this belief. 

Meanwhile, the SEC is set to make a crucial decision on VanEck’s spot ETH ETF application by May 23. 

Complicating matters is the ongoing controversy over whether Ethereum should be classified as a security. Recent documents indicate that the SEC believes it has been traded as an unregistered security for at least a year.

Ethereum (ETH) Price Analysis 

The price of Ethereum reached its yearly high of $4,100 on March 12, which was only 28% off its all-time high of $4,850. As it did, we saw signs of weakness, and a downturn happened.  

ETHUSD Coinbase | Credit: Nikola Lazic/Tradingview

At first, the price fell to $3,100 on March 20 but recovered to $3,700 by April 9. This was a lower high, followed by a lower low of $2,880 on April 14. Another lower high came, followed by a lower low of $2,810 on May 1. This could have marked the completion of the ABCDE correction in a descending triangle. 

ETH rose to $3,200 on May 6 but again stopped at the descending resistance, meaning there are now two scenarios ahead. Either the price will establish its first higher low since March 12 and is heading for a breakout to the upside, or it shows a final attempt for an uptrend has been wiped out. 

In the bearish scenario, we could see a breakout to the downside below the ascending support. This would hint at a potential 25% downfall to its next significant support of the $2,100 area. As Ethereum approaches the triangle’s apex, we will soon see the breakout direction, which will dictate the future outlook. 


Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.

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