Bloomberg Intelligence commodity strategist Mike McGlone has issued a bearish warning for Ethereum (ETH), stating the token appears vulnerable to further downside and is more likely to slip below key support than break to new highs as broader market volatility returns. McGlone specifically noted Ether appears to be heading toward the lower end of its $2,000-$4,000 range established since 2023, stating, "I see greater risks of it staying below $2,000 than above $4,000, especially when stock market volatility rebounds."
This cautious macro outlook starkly contrasts with Ethereum's on-chain fundamentals, which are showing significant strength. According to blockchain data, Ethereum's seven-day simple moving average of active addresses has climbed to roughly 718,000, marking the highest level on record. This milestone signals rising user participation and transaction demand across the network.
Despite this surge in activity, Ether's price has struggled to break out of its established trading range. At the time of reporting, the token was up about 3% on the day but remained well below recent highs. Analysts note this divergence between flat prices and rising usage has historically preceded periods of price appreciation, as expanding network activity often reflects growing utility that markets reprice with a lag.
The latest increase in network activity may be driven by higher Layer-2 adoption, renewed decentralized finance (DeFi) usage, or returning retail participation. For now, Ethereum's fundamentals appear to be strengthening even as macro risks—including equity market volatility and tightening financial conditions—weigh on investor sentiment.
Separate technical analysis suggests Ethereum may be nearing a potential recovery phase. ETH is currently trading near $2,900 after weeks of selling, with momentum indicators like the Relative Strength Index (RSI) signaling oversold conditions. While the broader market trend remains precarious and significant resistance sits in the $3,200-$3,400 zone, the oversold RSI and waning downside momentum suggest a corrective bounce could be the more probable near-term outcome.
