Top 4 Reasons Why Ethereum Price May Crash to $1,500 in June

Key Insights

• Ethereum price has formed an inverted cup-and-handle pattern.
• Spot ETH ETF outflows have continued rising in the past few weeks.
• Hyperliquid has largely disrupted Ethereum in the decentralized finance industry.

Ethereum price entered a deeper correction after declining from approximately $2,470 in April to around $1,986.

The decline coincided with weaker ETF demand, slowing institutional accumulation, and increasing competition from alternative blockchain networks. While technical indicators remain fragile, traders continue monitoring key support levels that could determine Ethereum’s next move.

Ethereum Price is Forming an Inverted Cup-and-Handle Pattern

The daily chart shows that ETH has crashed over the past few days and is now hovering at its lowest level since May 29. It recently formed a mini-death cross pattern when the 50-day and 25-day Exponential Moving Averages (EMAs) crossed.

The most notable aspect about Ethereum is that it has formed an inverted cup-and-handle pattern. It has already formed a rounded top and is now nearing the important support level at $1,763.

The distance between the cup’s upper and lower sides is about $700. As such, subtracting the same amount from the cup’s lower side suggests that it may crash to the key support level at $1,000.

The initial target for the ETH price is $1,765, the lowest side of the cup-and-handle pattern. A move below that level will point to more downside in the near term, potentially to the key support level at $1,500.

ETH Price Under Pressure Amid Rising Smart Money Selling

The other key bearish catalyst for ETH price is that smart money investors have continued dumping the token.

There are many ways of measuring smart money activity in the crypto industry. One of these is the performance of crypto ETFs. In this case, data shows that American investors, many of whom are institutions, are actively selling their coins.

Data shows that spot Ethereum ETF outflows resumed in May after pausing in the previous month. They lost over $540 million in assets in May this year after adding $350 million in April this year.

A closer look at this data shows that spot Ethereum ETFs have shed nearly $1 billion in assets this month. The cumulative net inflows have dropped from a record high of nearly $15 billion to $11.37 billion. These funds now hold $11.2 billion in assets.

BlackRock’s ETHA ETF holds $5.8 billion in assets, while four other funds have over $1 billion in assets. Continuing ETF outflows are a sign that demand is waning, potentially as investors rotate to other assets, including the booming stock market.

Ethereum is Losing Market Share to Hyperliquid

The other important bearish catalyst for Ethereum is that the network is fast losing its market share to Hyperliquid. For example, data shows that Hyperliquid’s perpetual futures marketplace has handled $188 billion in volume in the last 30 days.

In contrast, all Ethereum DEX platforms handled volume worth $35 billion in the same period. It has been overtaken by Solana, which handled $42 billion in the same period. Hyperliquid, which launched its layer-1 network a while ago, handled $9.5 billion in the same period.

These metrics explain why Ethereum is no longer making as much money as it used to make. It has made less than $100 million this year, much lower than what popular platforms like Tron and Circle have made.

Ethereum Treasury Companies are No Longer Buying

Meanwhile, there are signs that Ethereum treasury companies are no longer buying. Only Tom Lee’s BitMine is now buying Ethereum, and this phase will end soon.

BitMine has bought over 5.3 million coins in the last 12 months. It bought over 300k coins in the last 30 days. With its 5% target nearing, the company will stop buying, a situation that will lead to lower demand.

Therefore, a combination of waning treasury and ETF buying means that demand will continue to wane. This situation is also evident in the futures industry, where open interest has fallen substantially over the past few months.

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