Home Altcoins News Ethereum Bears Eye Drop Below $3K Amid Struggles

Ethereum Bears Eye Drop Below $3K Amid Struggles

Ethereum price

Ethereum’s price has been in a downward spiral for several weeks, with the digital asset continuing to face challenges as it struggles to maintain above key support levels. As the market turns bearish, many traders are predicting Ethereum’s value could drop below the $3,000 mark. Here’s a breakdown of what’s happening and what this means for the future of ETH.

Ethereum Fails to Reclaim $3.4K Support

Ethereum (ETH) has encountered significant resistance at the $3,400 level in recent weeks, with multiple failed attempts to turn this level into reliable support. The price has repeatedly tested this critical range but has been unable to sustain upward momentum. This trend has led to growing concerns about the asset’s near-term direction, particularly as the broader cryptocurrency market continues to show signs of weakness.

Despite some short-term rallies, Ethereum’s long-term outlook has been shaky. Traders have watched with caution as ETH continues to struggle to maintain momentum. The failure to reclaim $3.4K as support is just the latest in a series of hurdles for the leading altcoin, leaving the market bracing for potential further declines.

Bearish Signals in Price Action and On-Chain Metrics

Ethereum’s technical indicators paint a grim picture for the cryptocurrency. The daily Relative Strength Index (RSI) recently dipped below the neutral 50 mark, confirming the bearish sentiment in the market. The RSI is a popular momentum indicator that tracks whether an asset is overbought or oversold. A reading below 50 typically signals that sellers have the upper hand.

Further analysis of the On-Balance Volume (OBV) suggests that buying pressure is weak. The OBV is a volume-based indicator used to measure the flow of money into or out of an asset. In Ethereum’s case, the OBV has hovered around a support level seen in November and December of 2024, suggesting that the asset is struggling to attract sustained buying interest.

Ethereum’s Leadership Under Scrutiny Amid Market Struggles

In addition to the market’s bearish trends, Ethereum’s leadership has faced increasing scrutiny. Despite ongoing development, Ethereum’s foundation has received criticism for its inefficiencies and lack of clear direction. A recent informal poll indicated that 97% of voters—holding over 51,000 ETH—preferred Danny Ryan, a former researcher, to take the reins at the Ethereum Foundation. However, Ethereum co-founder Vitalik Buterin clarified that he remains the sole decision-maker when it comes to leadership changes within the foundation.

While this internal friction is unlikely to have an immediate impact on ETH’s price, the uncertainty surrounding Ethereum’s leadership could affect investor confidence in the long run. Market sentiment is often influenced not only by price action but also by the developments and governance decisions within a blockchain ecosystem.

Long-Term Holders Show Confidence, But Market Conditions Are Weak

Despite the bearish outlook, long-term holders (LTHs) of Ethereum appear to remain confident in the asset. Data from the NUPL (Net Unrealized Profit and Loss) metric, which tracks the profitability of long-term holders, suggests only moderate profit-taking activity. This implies that many Ethereum holders are not in panic mode and are still holding onto their positions despite the price downturn.

However, while long-term holders may not be dumping their assets, their confidence alone is not enough to counterbalance the overall bearish trend. Ethereum’s price has been on a steady decline for the past few months, and the overall market sentiment remains weak.

The $3K Support Zone and Potential for Further Decline

One of the critical levels to watch for Ethereum is the $3,000 mark. According to recent liquidation data, Ethereum is likely headed for a move below $3,000 in the near future. The liquidations data points to a potential drop toward $2,850, with further downside targets at $2,700. This suggests that the current bearish momentum may lead to significant price declines in the coming days or weeks.

A liquidation heatmap also reveals liquidity pockets both above and below $3,000. While there are areas of liquidity at higher levels—around $3,460, $3,800, and $4,200—the current market conditions suggest that Ethereum’s price is more likely to head southward. The heavy concentration of liquidations below the $3K range points to potential downward pressure in the near term.

Ethereum’s Road Ahead: Caution Advised for Traders

As Ethereum struggles to maintain its position, traders and investors are advised to proceed with caution. With the overall market sentiment remaining weak—especially for Bitcoin (BTC), Ethereum’s larger counterpart—the current environment is not conducive for aggressive bullish positions. Short-term traders may find it difficult to predict price swings, given the ongoing volatility.

For those looking to invest in Ethereum, it may be wise to wait for more favorable market conditions or clearer signs of a reversal before making a move. While long-term holders have maintained a steady presence in the market, Ethereum’s price action suggests that the near-term outlook remains uncertain.

Conclusion: Bears in Control, But Hope Is Not Lost

Ethereum’s recent price action paints a clear picture of a bearish market, with key levels like $3,400 failing to hold as support. However, the situation is not entirely hopeless. Long-term holders are showing confidence, and Ethereum’s overall fundamentals remain strong. Still, traders should remain cautious as the price may continue to struggle in the short term. With significant liquidation clusters and weak buying pressure, the focus remains on whether Ethereum can hold above the critical $3,000 level or if further declines are inevitable.

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Maheen Hernandez

A finance graduate, Maheen Hernandez has been drawn to cryptocurrencies ever since Bitcoin first emerged in 2009. Nearly a decade later, Maheen is actively working to spread awareness about cryptocurrencies as well as their impact on the traditional currencies. Appreciate the work? Send a tip to: 0x75395Ea9a42d2742E8d0C798068DeF3590C5Faa5

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