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Joel Frank
Author
Joel Frank
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Why Trust Cryptonews
The Ethereum (ETH) price is staging a tentative rebound on Friday in tandem with improving risk appetite across the broader crypto and traditional finance markets.
But make no mistake, last just above $1,940, the Ethereum price remains very much in a medium-term downtrend.
The Ethereum price is currently down more than 50% versus the multi-year highs it hit near $4,200 in December.
Much of these losses have come in the past three weeks, during which time broader financial market sentiment has taken a substantial turn for the worse.
Market’s have been grappling with the scary realization that the Trump administration may be deliberately pursuing policies of short-term economic pain in order to set the economy up for better long-term growth.
These include D.O.G.E austerity aggressively cutting deficit spending, disruptive trade wars aimed at bringing industry back to the US.
Some have also suggested the Trump administration is trying to cool off the economy in order to put downwards pressure on US interest rates, with $9 trillion in government debt (about 25% of the overall amount) scheduled for refinancing later in the year.
With risks tilted very much towards a further near-term weakening of the US economy, a major reversal higher for the Ethereum price seems unlikely in the near-future.
Where Next for the Ethereum Price? Bearish Trend to Continue
Since hitting oversold levels earlier in the week, its not unreasonable to expect that the current Ethereum price rebound could continue.
However, per chart analysis, unless the Ethereum price can bounce sustainably back above the $2,100 resistance area, and above its 21DMA at $2,230, the bears are very likely to remain in control of this market.
Risks continue to point towards a drop towards $1,500 in the coming weeks unless there is a serious improvement in macro sentiment, which doesn’t feel overly likely right now.
But long-term investors would do well to use the current Ethereum price dip as an opportunity to accumulate as much of the asset as possible.
That’s because when macro headwinds ease up and liquidity conditions improve – which could happen later in 2025 – Ethereum is likely to experience a major rebound.
Indeed, macro conditions aside, the Trump administration’s arrival in the White House marked the start of a new golden era for crypto in the USA.
A favorable regulatory environment in the world’s biggest economy should foster substantial growth in the Ethereum ecosystem in the coming years.
Ethereum remains the undisputed king of DeFi, has the backing of BlackRock and is the only current altcoin to have a spot US ETF, which are soon set to start offering staking rewards.
Its also worth noting that the Trump administration is packed with ETH HODLers. These narratives should be enough to carry the Ethereum price to new record highs as soon as macro headwinds let up.
The Ethereum price could even reach above $10,000 by the end of Trump’s term, a more than 5x rally from current levels.
So while more short-term downside may come, Ethereum remains a strong candidate for the best crypto to buy now.
