Ethereum Fails to Break $2,700…Market Tense as Fed's October Rate Hike Possibility Reaches 65%

▲ Ethereum (ETH) ©Go Dasol

Ethereum (ETH) failed to break the $2,700 resistance level and retreated to the $2,661 range. Amid renewed speculation about the U.S. Federal Reserve's (Fed) October interest rate hike and selling pressure at technical resistance levels, ETH recorded a larger drop than the market average.

According to cryptocurrency market data aggregator CoinMarketCap on September 28 (local time), Ethereum recorded a 1.48% decrease over 24 hours, reaching $2,661.18. During the same period, the total cryptocurrency market capitalization decreased by 0.92%. On Polymarket, the probability of the Fed raising the benchmark interest rate by 25 basis points at its October 27-28 meeting was reflected as 64-65%, spreading caution across risk assets.

Technical resistance also increased downward pressure. ETH fell after encountering resistance at the 23.6% Fibonacci Retracement level of $2,699. The 24-hour trading volume surged by 77%, indicating strong selling pressure at that price level, and the Relative Strength Index (RSI) was analyzed to be 63, suggesting room for further correction.

In the short term, the 50% Fibonacci Retracement level of $2,580 was identified as a key support level. If this price level holds, ETH could retest the $2,700 resistance. However, if $2,580 breaks, there is a possibility of further decline to the 78.6% Fibonacci Retracement level of $2,450.

The U.S. Personal Consumption Expenditures (PCE) price index, to be released on September 30, is a major variable that will determine the future direction. If inflation comes in lower than expected, concerns about interest rate hikes could ease, potentially leading ETH to rebound towards $2,700. However, if the Fed's hawkish monetary policy outlook strengthens, the $2,580 support level could be tested again. The inflow of $689.88 million into spot Ethereum ETFs last week was mentioned as a factor that could offset macro-economic selling pressure.

CoinMarketCap analyzed this decline as a result of market-wide risk aversion due to the Fed's interest rate hike outlook combined with technical selling pressure near $2,700, rather than a specific negative factor for Ethereum alone. In the short term, whether ETH can hold the $2,580 level after the PCE announcement on September 30 was identified as a key variable to determine further correction.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*