Ethereum’s Inverted Bull Flag Signals Risk of New Lows Below $1,400

Popular analyst Ali Martinez has identified a critical technical formation for Ethereum (ETH), but it comes with a major caveat. Martinez points out that ETH is forming what appears to be a bullish flag, a pattern typically indicating a pause before a continuation of an uptrend. However, he emphasizes a crucial twist: the chart is inverted. This inversion fundamentally changes the pattern’s implication. An inverted bullish flag forms during a sustained downtrend, representing a period of compression or consolidation within that decline.

According to Martinez’s analysis, shared via social media, this pattern suggests that Ethereum’s recent tighter trading range is not a base for a rally but a precursor to a more significant downward move. The analyst believes this could push the largest altcoin to new local lows, potentially falling under the $1,400 mark. This technical outlook provides a framework for understanding ETH’s repeated rejections at the $2,000 level, with each attempt met with selling pressure and correction, reinforcing the prevailing downtrend observed for weeks.

Adding to the complex picture, analyst Daan Crypto Trades has highlighted Ethereum’s underwhelming performance in the early part of the year. Daan notes that ETH has started 2026 on a worse footing than it did in early 2025, underscoring the current bearish momentum. This weak opening act sets a challenging stage, even as historical data offers a glimmer of hope. The analyst outlined that the March-to-May period has historically been beneficial for Ethereum’s price action.

However, Daan Crypto Trades immediately tempers this seasonal optimism with a significant caveat regarding current market dynamics. He points out that the crypto market has recently shown “pretty much zero correlation with other risk assets,” describing this decoupling as creating “an awful” environment for prediction. This lack of correlation introduces heightened uncertainty, making it difficult to rely on historical seasonal patterns or broader macroeconomic trends as reliable guides for ETH’s trajectory in the coming months.

Fundamental pressures are mounting alongside technical warnings. Data from the spot Ethereum ETF market reveals continued investor reticence. Last week, these funds experienced another week of net outflows, with approximately $113 million leaving the products. This sustained exit of capital reflects bearish sentiment among a segment of institutional and retail investors, applying consistent selling pressure on the asset.

In stark contrast to this trend, the company BitMine, chaired by Tom Lee, continues its aggressive accumulation strategy. Last week alone, BitMine purchased an additional 45,759 ETH. The company now holds a staggering 4,371,497 tokens, a position valued at nearly $8.7 billion at current prices. This accumulation, however, comes with a massive unrealized loss. With an average entry cost of $3,820 per ETH, BitMine is currently sitting on an $8 billion paper loss on its Ethereum position. This highlights a deep conviction strategy amid severe market downturn, representing a high-stakes bet on a long-term recovery.