Ethereum's weekly chart just lit up with a Tom Demark (TD) Sequential sell signal — the same indicator that preceded a brutal 63% drawdown back in August. With ETH trading around $2,220 after another down week, some traders are watching the setup closely.
The signal that preceded a 63% drop
The TD Sequential indicator, popular among technical traders, gave a weekly sell signal on Ethereum last August — and what followed wasn't pretty. ETH shed nearly two-thirds of its value in the months after. Now, a fresh sell signal has appeared on the same timeframe, and analyst Ali Martinez says every such weekly signal over the past year has been validated by significant price action.
That's not to say history repeats exactly. But the track record is hard to ignore.
Three price targets laid out
Martinez isn't mincing words about where ETH could go next. He's given three downside targets: $1,900 in the short term, $1,595 as a mid-term floor, and $1,090 as a long-term landing zone. The lowest target sits just above a key support level at $1,071 tied to a Parallel Channel pattern that's been forming for months.
From the current $2,220 level, even the first target implies roughly a 14% drop. The long-term target of $1,090 would be a cut of more than half from here. Martinez suggests Ethereum is entering another corrective phase.
The TD Sequential hasn't always been a bearish omen. Buy signals on the weekly chart last April and June preceded rallies of 86% and 134%, respectively. The tool flips both ways — right now it's pointing down.
Ethereum has been under pressure this month, declining through the week as broader crypto sentiment softened. Whether the sell signal becomes a self-fulfilling prophecy or fizzles out is an open question. For now, the chart's flashing yellow.
