A recent slide saw Ethereum (ETH) retreating below the $1,600 mark. However, on-chain and technical indicators suggest that the market may be heading for a key accumulation phase, historically a precursor to significant rebounds. This analysis was brought to light on Apr. 17 by CryptoQuant contributor abramchart.
The realized price level, presently around $1,585, has typically signaled deep-value accumulation. Ethereum’s price is nearing the lower band of this realized price model. This is an indication of a market cooling off, possibly setting the stage for long-term holders to re-enter.
The technical indicators, however, present a mixed picture. ETH has slid below its 20-day moving average and is significantly beneath the 200-day, suggesting a strong downtrend. The relative strength index is hovering just under 40, indicating weak momentum, though it’s not yet completely oversold. The daily Bollinger Bands are still compressed, signaling lower volatility. However, a decisive move could be on the horizon.
If this downtrend persists, ETH may find support in the $1,450–$1,550 range, a zone that has often served as a bottoming area. Immediate resistance is hovering around $1,670, with sterner overhead pressure potentially experienced at the $1,930 mark.
On the fundamentals, Ethereum’s value capture on layer 1 has significantly weakened since the Dencun upgrade, as pointed out in an Apr. 16 Binance Research article. While the introduction of blobs has increased scalability almost 16-fold, it has also resulted in a reduction of L1 fee revenues.
As users shift to cheaper layer 2s, the status of ETH as “ultrasound money” has been compromised, affecting its appeal in comparison to faster, low-fee alternatives like Solana (SOL) and BNB Chain (BNB).
An Apr. 16 analysis by Santiment revealed that Ethereum’s fees have plummeted to 5-year lows, averaging a mere $0.168 per transaction. While this does reflect a decline in usage and congestion, it could also indicate a potential rebound from a contrarian viewpoint.
Historically, fees below $1 have often paved the way for price rebounds. As Santiment pointed out, “The more the retail community leans away from an asset (especially one with still thriving development), the higher the likelihood of an eventual surprise rebound with little resistance.”
The pullback may be in part due to broader macro uncertainty. Traders are highly sensitive to tariff and economic news, often holding back on ETH activity until a clearer global picture emerges. As Ethereum navigates these complex market conditions, the interplay between technical and fundamental factors will likely continue to drive its price action.
