Ethereum (ETH) faces price correction after initial surge following Bitcoin ETF approval

Ethereum (ETH), the second-largest cryptocurrency by market capitalization, has experienced a minor setback, with its price dipping over 2% in the last 24 hours. This negative price movement comes after an initial price boost that saw the token gain over 19% following the news of the approval of a Bitcoin spot ETF in the United States on Wednesday.

Crypto analyst Ali Martinez has offered further insight into Ethereum’s developing downtrend, shedding light on the next possible support zones for this leading altcoin. In a post dated January 11, Martinez pointed out that the TD Sequential indicator had presented a sell signal on Ethereum’s 4-hour chart. 

This signal could potentially result in the altcoin’s price falling to a support level of $2,530. The TD Sequential indicator is a widely used technical analysis tool employed to identify trend exhaustion and predict potential trend reversals.

Martinez’s analysis suggested that ETH was due for a price correction after a rapid surge in which the asset traded above $2,700. This surge followed the United States Securities and Exchange Commission’s (SEC) approval of the launch of Bitcoin spot ETFs on US securities markets. 

In a subsequent post on January 12, Martinez reinforced this prediction, stating that if Ethereum bulls failed to maintain the coin’s value above $2,530, there was a possibility that the token could trade as low as $2,450. Despite the current negative price movement, Martinez believes it is likely a correction, as general investor sentiment surrounding the altcoin remains bullish.

Investors anticipate an Ether spot ETF in the US

Earlier this week, there was growing excitement among Ethereum investors due to the expectation of an Ether spot ETF in the United States. This anticipation followed the SEC’s clearance of 11 Bitcoin spot ETF applications on Wednesday. 

Ethereum’s status as the second-largest cryptocurrency after Bitcoin, coupled with the increasing number of Ether spot ETF applications, has led investors to believe that the altcoin may be on track to secure the SEC’s favor.

Ethereum’s recent price performance

At the time of writing, Ethereum is trading at $2,548, experiencing a slight decline of 2.67% in the last 24 hours. However, it is important to note that Ethereum has displayed an overall bullish performance over the past week, posting a notable gain of 14.48%. Furthermore, there has been an uptick in Ethereum’s daily trading volume, which has increased by 22.25%, currently valued at $26.8 billion.