Ethereum (ETH) has weakened more than 20% in a week in which FTX cryptocurrency exchange and its founder Sam Bankman-Fried bankrupt and ended up with a huge liquidity gap of over $8 billion that Bankman-Fried tried to raise from investors. FTX cryptocurrency exchange filed for Chapter 11 bankruptcy this Friday, while Sam Bankman-Fried has stepped down from his role as CEO.
It is also important to mention that FTX, on its official Telegram channel, reported that the exchange had been hacked and more than $600 million worth of cryptocurrencies mysteriously disappeared from the wallets of the bankrupt exchange FTX. FTX General Counsel Ryne Miller said:
“FTX has been hacked. FTX apps are malware. Delete them. Chat is open. Don’t go on the FTX site as it might download Trojans.”
Ethereum (ETH) erased almost all of its Thursday gains minutes after the bankruptcy announcement, and the risk of further declines is probably not over. Mike McGlone, a senior macro analyst at Bloomberg, also said that he believes that the repercussions of the cataclysmic FTX downfall will likely send Ethereum price to new lows.
Technical Analysis Of Ethereum
The price of Ethereum has weakened from $1,608.50 to 1,071.50 in less than three days, and the current price stands at $1,240.50. The price has formed a symmetrical triangle pattern, a continuation pattern that typically resolves after the price breaks out of its range while pursuing the direction of its previous trend.
Ethereum might have a hard time holding above the $1,000 level in the upcoming weeks, and a break below this level would indicate that we could see ETH at $900 or even $800. The upside potential remains limited for now; still, if the price of Ethereum jumps above $1,400, the next target could be $1,500.
Conclusion
Ethereum (ETH) has weakened more than 20% in a week in which FTX cryptocurrency exchange filed Chapter 11 for bankruptcy, and the risk of further declines is probably not over. Ethereum might have a hard time holding above the $1,000 level in the upcoming weeks, and a break below this level would indicate that we could see ETH at $900 or even $800.
