Ethereum Price Forecast: ETH Could Drop to $4163 as Hopes of Rates Cut Fade

Highlights:

• Ethereum is in a bearish channel while making lower lows
• Price action could push Ethereum to weekly support at $4163.0
• Fears of no rate cut in September are fueling Ethereum price action 

Ethereum (ETH) is in the red today, reflecting the weakness across the cryptocurrency market. When going to press, Ethereum was trading at $4276.31, down by 6.14% in the day. This price drop has been followed by an increase in trading volumes. In the last 24 hours, Ethereum trading volumes have increased by 86.34% to $48.08 billion. This indicates that short-term traders may be exiting their Ethereum positions.

This is expected after Ethereum’s strong rally from under $1500 to $4600. Traders who have already made remarkable returns could be looking to book some profits. However, the more significant reason is that the macro environment, especially on interest rates, could take liquidity away from risk-on assets such as cryptocurrencies. 

Ethereum Price Drops Amid Fears That Fed Won’t Cut Rates

Like Bitcoin, Ethereum’s recent rally has partly been fueled by expectations that the Federal Reserve could start cutting rates as early as September. This was expected to unleash a new wave of liquidity into the market, one that could push the price to new highs in the short to medium term. However, incoming data indicate that an interest rate cut could be delayed even further.

For context, recent US wholesale price data shows that prices rose more than expected. This is a big deal as it indicates that the tariffs are starting to impact the economy. By extension, the Federal Reserve may hold off on cutting interest rates to avoid inflation spikes. The result is that risk-on assets, especially highly speculative ones like cryptocurrencies, could lose momentum in the short term. This explains the ongoing selloff for Ethereum and other cryptocurrencies. 

🔻 Crypto is down 5–10% today as BTC, ETH & alts dip.
🏛️ White House peace talks are adding market uncertainty.
📉 A leverage flush is wiping out overextended longs.
💹 Rate cut odds dropped from 100% to 84.8% after PPI data.
🪙 This dip looks like a healthy entry before the next pic.twitter.com/gXd8abVHDU

— 𝘃𝗶𝗰𝘁𝗼.𝘅𝗿𝗽 | 𝕏𝗥𝗣𝗟 𝗕𝘂𝗶𝗹𝗱𝗲𝗿 🐦‍🔥 (@victoweb3) August 18, 2025

Over $100 Million In Ethereum Longs Liquidated In 24 Hours

The fear around interest rates is evident in Ethereum long/short data, where $110 million worth of Ethereum longs were liquidated. The weakness is also apparent in Ethereum ETFs, which have experienced a slowdown. After months of strong inflows, the latest data indicates outflows of $272 million from Ethereum ETFs. This is a pointer that even institutional money is wary of what is happening in the macro environment and cutting down on their exposure to Ether.

$110m IN $ETH longs were liquidated in the last 24 hours.

If you're new, HODL and DCA is still the best option. pic.twitter.com/esEXL5o7Y0

— Kyle Chassé / DD🐸 (@kyle_chasse) August 18, 2025

Positive Rates New From Jackson Hole Could Trigger Ether Rally

Looking ahead in the short term, Ethereum’s price action could remain weak until the Jackson Hole Symposium scheduled for August 21 to 23. It is during this event that the Fed Chairman is expected to give a hint as to the direction the Federal Reserve is going with interest rates. If he hints at a possible rate cut, Ethereum could see a V-shaped recovery that could see it rally back to its all-time highs.

On the other hand, if he hints at inflation concerns and a possible continuation of the current rate environment, Ethereum could face further correction in the short term. Long-term, Ethereum is likely to be demand-driven, and the underlying demand remains strong. That’s because whales continue to buy Ethereum in large amounts, which could trigger upside price pressure. For context, a whale recently bought 1860 Ethereum, a pointer to strong confidence in the number two cryptocurrency. 

The 2025 Jackson Hole Economic Policy Symposium is set to begin later this month in Wyoming.

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— Kansas City Fed (@KansasCityFed) August 16, 2025

Technical Analysis – Ethereum Price Making Lower Lows In A Bearish Channel

Ethereum has been trading in a bearish channel for most of the day. During this period, it has been making lower lows, an indicator that every attempt at a rebound has been sold off. If this trend continues, Ethereum could drop to weekly support at $4163.0.

However, Ethereum could rally back to the intraday resistance at $4571.7 if substantial volumes back a rebound. Of these two scenarios, a drop to $4163.0 support is more likely as bears control the market.