Ethereum (ETH) has seen a recent 18% rally from its weekly low, sparking hope among investors that the bottom may be in. However, a closer look at the charts and broader economic conditions suggests that the pain might not be over just yet. Here are three compelling reasons why Ethereum could still face more downside.

1. Key Resistance Level Remains Unbroken

Despite ETH’s recent bounce, the price is currently facing a formidable resistance level around $1,630 — a zone that has seen the highest volume of trades since February 2021. This price point previously acted as strong support but turned into resistance after the latest downturn. Unless bulls can reclaim and hold above this level, Ethereum may continue its descent.

Below this resistance lies a crucial support zone between $1,280 and $1,160. This range acted as a springboard in December 2022, sparking a 40% rally. If ETH revisits this area, it could either bounce again — or break lower to test the next critical support between $890 and $715.

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2. RSI Suggests More Downside Ahead

Technical indicators also paint a cautious picture. The Relative Strength Index (RSI) on Ethereum’s weekly chart has yet to enter oversold territory. Historically, major ETH rallies have only emerged after the RSI dips below the oversold threshold. With the current reading still above that mark, there’s room for Ethereum to fall further before bulls take charge again.

3. Macroeconomic Turbulence Looms Large

Geopolitical and economic uncertainty continues to cast a shadow over risk assets, including cryptocurrencies. The escalating trade tensions between the U.S. and China — particularly under the looming specter of a renewed Trump-Xi rivalry — have amplified market volatility.

Add to this week’s high-stakes events — Fed Chair Powell’s speech and the March inflation report — and it’s clear that external shocks could easily shake ETH’s fragile footing. If either development disappoints, Ethereum could face another wave of selloffs.

While Ethereum’s recent price action offers a glimmer of hope, the technical and macro indicators suggest that the bottom may not be in yet. Investors should brace for increased volatility and keep an eye on key support levels as ETH navigates this uncertain terrain.