📉 Ethereum Price Analysis: 3% Drop in a Week, Correlation with Bitcoin Weakens

Over the past 7 days, Ethereum has fallen by more than 3%, making it one of the main underperformers of the week.

🔄 Changing Correlation with Bitcoin

If we look at the past 2 years (2022-2023), the correlation coefficient between Ethereum and Bitcoin was quite high, exceeding 94% on average. However, the situation has changed slightly, and the correlation coefficient has now dropped to 85%. The price of Ethereum is also much closer to its historical average compared to Bitcoin.

📊 ETF Impact on Bitcoin and Ethereum

It’s interesting to compare the price behavior of these coins post-approval of spot ETFs by the US SEC. While Bitcoin surged by more than 60% in the two months following the approval, Ethereum has seen a decline:

• In August, Ethereum’s price fell by 22%.
• In September, the decline currently stands at over 7%.

This may be a case of the “buy on rumors, sell on facts” rule playing out for ETH, as the coin performed well in the first half of the year. In Q1, Ethereum saw growth of 60%, while in Q2, the correction was modest at around 5.8%.

🏦 Fed Rate and Ethereum Price Correlation

Another interesting aspect is Ethereum’s price behavior in relation to the Federal Reserve’s rate. In 2021, when the rate was lowered to 0.25%, Ethereum reached its all-time high, climbing above $4,865. This is a typical reaction, as a weaker dollar tends to boost Ethereum’s price.

📅 Upcoming Federal Reserve Meeting

The next Federal Reserve meeting is scheduled for September 18, where a decision on the key interest rate will be made. The market is currently pricing in a rate cut, with expectations of a 25 bp decrease. The tone of Governor Jay Powell’s remarks will be crucial, as the market expects a dovish signal, indicating further easing. In a broader sense, we may be on the cusp of a monetary policy reversal, which could be a positive sign for Ethereum.

📈 Technical Analysis: ETHUSD Price Outlook

Technically, ETHUSD is nearing a support cluster, which is between $2,095.50 and $2,140. If a reversal occurs and the price starts to rise, the first resistance level could be around $2,820. A breakout could see a move toward $3,050.

Overall, the probability of growth in the current market configuration is higher than the likelihood of continued decline.