Ethereum (available on Coinbase) (ETH) began to recover yesterday, after tumbling almost 35%. The market cap now stands at US$53.31 billion, on exchange-traded volume of US$1.5 billion in the past 24 hours. The ETH/BTC and ETH/LTC ratios have also dropped sharply, signaling a narrow selloff in ETH alone.
The 500-pound gorilla in the room is if and when projects currently holding millions in ETH from Initial Coin Offerings (ICOs) will sell their treasury or will continue to hold through the drawdown. This selling pressure will continue to build if ETH price moves lower as more and more ICOs will continue to hit their breaking point or capitulate on some or all of their holdings. Some projects have also invested their holdings into other ICOs, creating a risk pool reminiscent of the credit default swap debacle which brought down global financial markets in 2008.
According to CoinSchedule, there have been 88 ICOs this year, raising a total of 3.38 billion in less than three months. The largest raise this year, US$850 million, was the first round of the Telegram ICO. In 2017, 210 ICOs raised a total of US$3.88 billion.
Block.One’s EOS is one of the largest holders of ETH, with 445,000ETH, and continues to collect funds for their ICO. On March 17th, around 10:40PM EST, over 50,000ETH moved from the EOS wallet to a Bitfinex exchange. The ETH appears to have been sold the following day.
Furthermore, EOS is direct competition with Ethereum (available on Coinbase), and a self-proclaimed ETH killer. By holding large amounts of ETH, the EOS team can lean on the ETH price when it is advantageous to do so. EOS was also recently covered in a segment by late-night satirist John Oliver, which among other things highlighted troubling allegations against Brock Pierce.
The EOS team responded in an open letter, entitled “Dear John Oliver” and removed Brock Pierce as an advisor, saying “we recently came to a mutual agreement that Brock would end his role at block.one as he transitions to independent community building and investment activities.”
The explosion in ICOs over the past 12 months continues to draw the attention of the United States government. According to the Wall St. Journal, the Securities and Exchange Commission has issued “dozens” of subPOENAS and information requests to technology companies and ICO advisers. President Donald Trump recently signed an executive order today barring US citizens from transacting in Venezuela’s Petro sale. The Petro tokens continue to remain on a single NEM address.
On the network side, transactions per day and transaction fees are currently mirroring levels last seen in the beginning of December, signaling a slowdown in network use. A decrease in speculation, dApp usage, and ICO issuance may be responsible for this decline.
ETH’s rising Network Value to Transactions (NVT) ratio is moving in response to a slowdown in network transactions. A low or falling NVT suggests the asset may be undervalued. A rising NVT ratio suggests that the asset may be overvalued. The ratio broke out of a tight range formed earlier in the year. BTC, LTC, and ETC all carry NVT’s half that of ETH, while Doge carries the lowest NVT of all.
Hash rate and difficulty continue posting new record highs, despite the hard fork in October 2017 decreasing the block reward from 5ETH to 3ETH. Mining profitability is currently down over 70% from peaks established in both June 2017 and January 2018. Both of these time periods were marked by record price levels and transaction fees. As difficulty rises and transactions remain unchanged or decrease, mining profitability will continue to decrease.
Exchange traded volume is led by the Bitcoin (available on Coinbase) (BTC), U.S. Dollar (USD), and TETHer (USDT) pairs. The majority of trading has been conducted on OKEX, Binance, Bitfinex, and GDAX. The Korean Won (KRW) trading pair holds a premium of 4.3%. The decentralized exchanges IDEX and Fork.Delta facilitated the highest volume over the past week amongst their peers.
The Over The Counter (OTC) exchange LocalEthereum (available on Coinbase) averaged less than ~200ETH per day in transaction volume over the past week, according to dapprADAr. In comparison, LocalBitcoin (available on Coinbase)s averaged 7,696BTC worldwide in the past week, according to coin.dance. Traditional OTC desks often require a minimum order of between US$100,000 and US$250,000, whereas these peer-to-peer marketplaces have no minimum order size.

Technical Analysis
ETH has undergone sustained bearish momentum over the past week. The status of the current trend can be determined using Ichimoku Cloud, Moving Averages, Support Zones, and Chart Patterns. Further background information on the technical analysis discussed below can be found here.
The Ichimoku Cloud metrics on the weekly chart, with singled settings (10/30/60/30) for quicker signals, remain bullish, although price has fallen far below the Kijun. A long exit signal, the bearish TK cross, is likely going to occur in the coming weeks. Price is now in a no-mans land based on the Cloud in this timeframe, although it did find support on the 50EMA. Look for a weekly dragonfly candle close for a potential bullish reversal, and retrace back to the Kijun around US$800.
The Ichimoku Cloud metrics on the daily chart, also with singled settings, are entirely bearish. The Tenkan (T) and Kinjun (K) lines are now bearish, having recrossed on March 7th after failing to reach the Kumo twist. This bearish cross below the Cloud typically signals bearish continuation, which in this case proved true.
Price found support on a previous consolidation zone and closed as a dragonfly, a potential bullish reversal, even more likely with a green daily close today. Resistance targets include the 200EMA at US$650 and the Kijun at US$720. There is also another potential bearish continuation signal, the 50/200EMA death cross, which would be the first since November 2016.  
The Ichimoku Cloud metrics on the daily chart, with doubled settings (20/60/120/30) for more accurate signals, is also entirely bearish. The distance of Price from the Kijun (red) suggests that Price is heavily oversold. Price will likely move to the mean, Kijun, at US$850 before moving lower. A Kumo twist on April 12th gives an opportunity for a bullish reversal above Cloud, should momentum exist to thrust price through the resistanceless zone.
On the four hour chart, a bullish three drives chart pattern may have completed. This occurs when three consecutive moves of the roughly same size occur, followed by a reversal. The target for completion of this pattern is 50% of the entire move, or around US$660. A peak in volume on the selloff is also highly suggestive of capitulation and bearish exhaustion.
Lastly, ETH/BTC on the twelve hour chart has fallen far below the 200EMA and completed a bearish head and shoulders pattern, both indicating sTron (available on Binance)g bearish momentum. The measured move, 1.618 Fibonacci extension, and monthly pivot all point to 0.050BTC, a sTron (available on Binance)g psychological support level. On lower timeframes, the formation of a bear pennant further suggests additional downside.

Conclusion
Fundamentals suggest slowing network utility, with an increase in governmental scrutiny following some gigantic ICO funding rounds. Collectively, ICOs represent an increased risk burden on the ETH network by holding large amounts of ETH and using that to potentially invest in other ICOs or startups. Based on available blockchain data, most of the ICOs have continued to hold through the pullback from all time highs.
Technicals are bearish yet optimistic. The technical indicators point to a sTron (available on Binance)g bounce back to the mean around US$850, based on the current oversold market conditions. Price has an opportunity to flip bullish around April 12th, should momentum exist. ETH/BTC remains heavily bearish with targets between 0.040BTC and 0.050BTC.