Ethereum's Macro Backdrop Stays Negative as Trump's Iran Remarks Fuel Renewed Risk Aversion
Key Takeaways
- •Ethereum's selloff deepened after US President Donald Trump said on Truth Social that the United States does not need a deal with Iran, prompting another wave of risk-off flows across markets.
- •The dollar and Treasury yields jumped following the remarks, lifting inflation concerns and expectations of additional interest rate hikes.
- •A concrete breakthrough in US-Iran negotiations or a more dovish Federal Reserve would likely be needed to spark a relief rally in Ethereum.
- •On the daily chart, buyers are expected around the 1,900 level with risk below 1,850, positioning for a rally toward 3,400 resistance, while sellers target a break lower toward 1,500.
- •The trading week ends with the release of US PPI data, a wholesale inflation measure watched as an early indicator of price pressures.
Ethereum, the second-largest cryptocurrency by market capitalization, extended its selloff after US President Donald Trump stated on his Truth Social platform that the United States does not need a deal with Iran, triggering another wave of risk-off flows across financial markets.
The US dollar and Treasury yields jumped following the remarks, which heightened inflation concerns and expectations of additional interest rate hikes.
The development continues to create a challenging environment for risk assets, as higher real yields — which strip out inflation expectations — and tighter financial conditions could ultimately lead to a slowdown in economic growth.
For now, the macro backdrop remains negative for Ethereum. A concrete breakthrough in US-Iran negotiations or a more dovish Federal Reserve would likely be needed to trigger a relief rally in the cryptocurrency.
Ethereum Technical Analysis – Daily Timeframe
On the daily chart, Ethereum extended the selloff and eventually reached the 1,900 level. Buyers are expected to pile in around these levels, with risk defined below the 1,850 level, to position for a rally into the 3,400 resistance, with the downward trendline as the first target. Sellers, on the other hand, will want to see the price break lower to increase bearish bets toward the 1,500 level next.
Ethereum Technical Analysis – 4-Hour Timeframe
On the 4-hour chart, a downward trendline continues to define the bearish momentum. In the event of a pullback, sellers are expected to lean on the trendline, with risk defined above it, while keeping the 1,500 level as their target. Buyers, meanwhile, will want to see the price break higher to extend the pullback into the major downward trendline.
Ethereum Technical Analysis – 1-Hour Timeframe
On the 1-hour chart, sellers have the better risk-to-reward setup around the trendline, while buyers will need a breakout to open the door to new highs. The red lines on the chart define the average daily range (ADR) for today.
Upcoming Catalysts
The trading week concludes today with the release of US PPI data, the Producer Price Index that measures wholesale inflation and is watched as an early gauge of price pressures, according to the economic calendar.
