Cointelegraph analysts reveal the reasons for the fall of the Ethereum cryptocurrency

On Monday, May 27, the main altcoin made a decisive attempt to break through the $ 3934 area. Buyers failed to realize their potential. Then, a deep correction began, in which ETH is still in. Representatives of Cointelegraph commented on this situation and talked about the reasons why the bearish trend is developing.

They believe that the key factor was the sharp rise in US Treasury yields. This provoked an increase in investor demand. Bidders also began to doubt that the Federal Reserve would be ready to ease monetary policy in the near future.

This view is confirmed by the recently published minutes of the last Fed meeting. They show that many officials took a rather radical stance. Undoubtedly, they noted that inflation in the US has shown a clear decline in recent months. But, according to the officials, there is no reason to believe that it is ready to slow down to the 2% target.

At the same time, sell-offs by large investors are putting significant pressure on price dynamics. Online metrics show that holders with a balance of 1 to 10 million ETH have lost 1% of their holdings over the past day. It is also noteworthy that investors with assets between 100,000 and 1 million ETH are also massively increasing their supply. If we evaluate the market situation from a technical point of view, Ethereum is in a bullish trend globally.

Experts note the $ 3600 area as a key support level. In their opinion, market participants should now closely monitor the price reaction to this support zone. If the quotes break below this level, a deep drawdown may begin up to $ 3300.