Ethereum Price Prediction: ETH Could Face Another Stress Test at $1,800 as Clarity Act Gets Shelved

Ethereum (ETH) has dropped by 5% in the past 7 days and seems to be eyeing a retest of the $1,800 support after the U.S. Senate shelved the Clarity Act ahead of its Summer recess.

The odds of passing in 2026 have gone down to 26% on Polymarket, down from a recent peak of 46% in late July.

This could accelerate cryptos’ path to a lower level this week, as a lack of positive catalysts and a challenging macro backdrop continues to keep a lid on the latest rallies.

Trading volumes have once again dropped to low levels. At $6 billion, ETH’s volumes currently account for just 2.8% of the asset’s circulating market cap.

Ethereum Volumes Remain Thin as Market Conditions Continue to Be Unfavorable

Looking at data from Santiment, we can see that Ethereum’s volumes have dropped to their lowest levels since December 2023. Even though the token started to recover back then, a buy signal had flashed as the 7-day moving average had crossed above the 30-day MA just a few days before.

With volumes at such low levels, interest in ETH seems to be too weak to sustain any price increase. Hence, the path of least resistance for the token is still down, as traders who cashed in on the latest bull run to $1,900 could continue to take profits off the table.

On the other hand, a disagreement between the Federal Reserve’s officials during last month’s meeting confirmed the market’s view that a rate hike could be implemented in September.

According to data from FedWatch, the odds of a 25 basis point increase during next month’s meeting have now jumped to 63%. Higher rates are bad for cryptocurrencies, as low-risk assets become more appealing to investors due to their higher returns.

Despite these bearish signals, net inflows to Ethereum-linked exchange-traded funds (ETFs) broke a 2-month streak of negative prints as $365 million flowed to these vehicles in July.

Weekly Buy Signal Persists as ETH Bounced Off $1,500

We have been stating in recent weeks that cryptocurrencies could be nearing their cycle bottom, as a handful of on-chain and technical signals are starting to flash “buy”.

Looking at the weekly chart, we can see that the Relative Strength Index (RSI) has marked the end of previous bearish cycles multiple times after dropping to the 30 level in this higher time frame.

This has already happened twice this year, while the price of the token recently bounced off a long-dated support at $1,500.

Based on how this signal has performed in the past 8 years, we could expect strong gains ahead during the next bull market that could possibly push Ethereum above the $5,000 level in the next 12 months.

“From a tactical standpoint, we expect the crypto market to bottom and start showing momentum towards late Q3 and early Q4 prior to the mid-terms,” analysts from Bernstein commented last week.

This is in line with our projections for the crypto market, but we still need a strong positive catalyst that helps ETH and other top cryptos break through key resistances and trigger some FOMO.

For now, the $1,800 support needs to hold to prevent a retest of that $1,500 long-dated demand zone. If that’s the case, this rally could still have enough legs to keep going.