Ali Martinez: BTC and ETH are preparing for a sharp drop

Cryptocurrency analyst Ali Martinez tells his 56,500 followers on X platform that Ethereum BTC $76,747.18 Mezo Wrapped BTC -2.38% Market capitalization $75.49 million VOL. 24 hours $1.27 billion is currently in a bearish trend after falling below the $ 3,400 support level.

The trader shared a chart showing that ETH could fall by more than 14% from current levels: «The most severe scenario for Ethereum right now is a breakdown of the $ 3,400 support level. Such a move could confirm the formation of a bearish pennant on the daily chart, which could potentially trigger a major correction of ETH to $ 2,800.»

Abearish pennant is a technical pattern that indicates the continuation of a downward price action on a chart.

Martinez notes that the $ 2,850 level could provide support for Ethereum as it is the price area where 1.99 million addresses collectively bought a total of 1.64 million ETH: «Ethereum falling below $ 3,460 is a problem for the bulls! Given the lack of support, it increases the chances of a further correction to $ 2,850 or lower.»

As for bitcoin BTC $76,747.18 Mezo Wrapped BTC -2.38% Market capitalization $75.49 million VOL. 24 hours $1.27 billion , the trader says the cryptocurrency is likely to see more falls if it starts trading below the 200-day exponential moving average (EMA) on the four-hour chart: «The 200-day EMA on bitcoin’s four-hour chart has been a huge support. Since early February, it has prevented BTC from falling further. For this reason, I’m paying close attention to this level because if it holds, it guarantees a rebound, but if it breaks through, as it did in mid-January, it could lead to even more losses for BTC.»

As of the morning of April 4, the global market capitalization lost 0.77% to $ 2.48 trillion. Daily cryptocurrency transactions fell by 23% to $ 94.7 billion. Bitcoin’s market share was 51.1%, and ethereum’s was 16%. The Fear and Greed Index hit 72 points.