Ethereum Price Forecast: ETH Eyes $1.5K As Microsoft Dampens AI Revolution Sentiment

Ethereum’s native token, Ether (ETH), is slipping into the breakdown phase of a developing inverse cup-and-handle pattern. The move comes as risk appetite weakens on AI bubble-burst fears after a Microsoft blunder knocked stocks lower.

Ethereum Technical Analysis: $1,500 Still On Table

ETH’s daily chart is carving out a rounded top (the “inverse cup”) followed by a shallow consolidation range (the “handle”), a setup that often signals downside continuation if support gives way.

In a textbook inverse cup-and-handle, the downside target is typically derived by measuring the pattern’s depth and projecting it lower from the breakdown area. Using that measured-move approach keeps $1,500–$1,600 in view as a potential next major downside zone.

Conversely, ETH’s daily relative strength index (RSI) is sitting in the mid-30s, nearing oversold territory. A push closer to 30 can increase the odds of a relief bounce, even if the broader structure remains heavy.

For bulls to meaningfully challenge the bearish setup, ETH would likely need to reclaim the handle range at around $3,000 and hold above it. In my view, that will lead to a broader recovery toward the handle’s upper boundary at around $3,499

Microsoft’s AI Spend Shock Is Repricing Tech and Crypto

The latest risk-off wave has been fueled by AI bubble-burst fears led by Microsoft shares.

The MSFT stock sank on a combination of record spending and slowing cloud-sales growth, sharpening investor concerns about whether AI investment is delivering enough return.

Microsoft’s Azure unit posted 38% revenue growth, matching expectations but slowing from the prior quarter, a detail markets read as a potential warning sign for the broader AI-driven cloud boom that has powered tech leadership.

Microsoft CEO Satya Nadella pushed back on monetization worries, saying companies are now paying for 15 million M365 Copilot subscriptions, with adoption rising among corporate users.

As a result, traders rotated more defensively in the last 24 hours, pressuring high-beta assets like Ethereum, as crypto often tracks tech more closely during risk-off stretches.