Ethereum's 'Most Brutal Scenario': Breaching This Support Level And A Drop To $2,800, Says Trader

Ethereum could face a significant correction if it breaks the $3,400 support level, according to trader Ali Charts.

What Happened: On Monday, Ali Charts tweeted a warning to traders about a potential bearish scenario for Ethereum ETH/USD. If the cryptocurrency breaches the $3,400 support level, it could confirm a bear pennant formation on the daily chart, potentially triggering a major correction down to $2,800.

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The potential bearish scenario outlined by Ali Charts aligns with his previous analysis of Bitcoin’s key support and resistance levels.

Ali Charts highlighted the importance of Bitcoin securing vital support levels to maintain its upward trajectory.

Why It Matters: Similar to Bitcoin, Ethereum’s price stability is also contingent on maintaining key support levels.

A breach at the $3,400 support level could signal a bearish trend, potentially leading to a significant price correction. This could have substantial implications for traders and investors, particularly those heavily invested in Ethereum.

As such, Ali Charts’ warning serves as a reminder of the volatility inherent in the crypto market and the importance of being prepared for both the best and worst scenarios.

What’s Next: The appeal of Ethereum as a novel institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on Nov. 19.

Now Read: Stocks Fall As Dollar, Treasury Yields Jump On Upbeat Manufacturing Data, VIX Rallies: What’s Driving Markets Monday?

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This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.