The cryptocurrency market has been experiencing a significant decline, and Ethereum (ETH) is no exception. With a current price of $3,568, ETH has dropped below $3,400, raising concerns among investors. Two primary factors are contributing to this decline: market negativity and regulatory delays.

Market Negativity and Regulatory Delays

The Federal Reserve's actions have led to a general negativity in risk markets, impacting ETH's price. Additionally, the Securities and Exchange Commission (SEC) has not accelerated the approval process for the S-1 Form, which would allow spot Ethereum ETFs to trade on the stock market. Although SEC Chair Gary Gensler hopes to complete the process before summer's end, experts predict S-1 Form approvals may not come until mid-July, later than initially expected.

Investor Sentiment and Sales

The price drop has triggered increased skepticism among ETH investors, leading to sales and further losses for those who held onto their investments. The network's realized profit and loss indicator shows a surge in sales over the past few days, with long-term investors also selling their assets. The Age Consumed metric reveals that these investors have held their assets for an extended period.

Resistance and Potential Outcomes

Ethereum's current price faces resistance from the 50% Fibonacci Retracement level. If the bulls fail to make strong closures above this resistance, ETH may continue to decline. However, if the resistance level is surpassed, a return to $3,800 is likely, recovering some losses.

Upcoming Challenges

As the ETH ETF launch date approaches, two significant issues may arise. First, a "sell the news" scenario similar to the BTC ETF approval may occur, leading to a price drop. Second, the ETHE trust, issued by Grayscale with massive Ether reserves, may experience a period similar to GBTC, resulting in selling pressure and potential losses for investors.

In conclusion, Ethereum's decline is attributed to market negativity and regulatory delays. Investors are advised to conduct thorough research and be aware of the high volatility and risks associated with cryptocurrencies.