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Ethereum (ETH) has continued to face strong downward pressure, losing key support levels as market sentiment weakens across the broader crypto sector. Following Bitcoin’s recent decline, Ethereum has struggled to maintain its footing above the $4,000 mark, leaving investors uncertain about its short-term direction.
As volatility rises, market analysts are split — with some expecting a short-term recovery before another correction, while others believe the altcoin could have already reached its cycle top.
Ethereum’s Price Faces Continued Downtrend
In recent weeks, Ethereum’s price performance has disappointed traders, falling below several crucial support zones. The drop came after Bitcoin’s sharp retracement, which triggered widespread sell-offs across altcoins.
Currently, Ethereum trades just below the $4,000 threshold, and analysts are warning that a sustained close under this level could open the door for deeper losses. The selling pressure appears to be intensifying, with momentum indicators turning bearish on higher timeframes.
Analyst Suggests a Possible Short-Term Recovery
Crypto analyst Melikatrader shared a mixed outlook for Ethereum, highlighting that the recent “liquidity sweep” around the $3,700 level may have set up a temporary base for recovery. This liquidity event, often called a “Hunting,” occurs when the market captures stop-loss levels before reversing upward.
According to Melikatrader, Ethereum has been consolidating between $3,700 and $3,800, forming what could become a foundation for a short-term bounce. If buyers are able to hold this range, it might push the price toward the next resistance area between $4,080 and $4,180.
This zone, often referred to as the “supply zone,” represents a region where sellers previously dominated, making it a crucial test for bullish momentum.
However, the analyst also cautioned that Ethereum’s overall structure remains bearish, with an ascending trendline acting as a potential resistance. “If ETH fails to break above $4,100 and gets rejected, we could see a renewed move below $4,000,” Melikatrader noted.
Resistance Around $4,100 Could Trigger Another Drop
The $4,100 level has become a psychological barrier for traders watching Ethereum’s short-term recovery attempt. A rejection from this level could confirm the bearish pattern forming on the daily chart, reinforcing the risk of a deeper correction.
If Ethereum is unable to sustain upward momentum, analysts warn that prices could revisit $3,700 — or even lower levels near $3,500, which previously acted as a consolidation range during earlier market phases.
Market data from TradingView shows that the relative strength index (RSI) remains in neutral territory, suggesting there is still room for movement in either direction. However, trading volume continues to decline, signaling reduced investor confidence in near-term recovery.
Some Analysts Believe the Cycle Top May Already Be In
While short-term traders are hopeful for a rebound, another group of analysts believes Ethereum may have already reached its cycle top. Crypto market commentator CRYPTO Damus compared the current ETH chart to previous cycle peaks in 2018 and 2021, warning that history may be repeating.
Using weekly data, Damus pointed out a similar structure — multiple green candles during the final stage of a rally, followed by consistent red candles signaling the start of a bearish reversal.
According to his analysis, Ethereum’s recent rally pattern mirrors those seen in previous bull cycle endings, suggesting that the altcoin may be entering a longer corrective phase.
Market Cycles Show Familiar Patterns
CRYPTO Damus emphasized that while no two market cycles are identical, the similarities are hard to ignore. Both in 2018 and 2021, Ethereum peaked after several weeks of sustained gains before entering an extended downtrend.
If this pattern holds, Ethereum could face a multi-month correction, with potential downside targets below $3,000. “It’s possible that this time could be different,” Damus said, “but the chart structure looks eerily similar to previous tops.”
Despite this bearish view, some traders remain cautiously optimistic. They argue that institutional demand and Ethereum’s strong fundamentals — particularly in decentralized finance (DeFi) and staking — could help prevent a major collapse similar to previous bear markets.
Ethereum’s Long-Term Outlook Remains Divided
The ongoing debate among analysts highlights the uncertainty surrounding Ethereum’s next move. While short-term charts suggest a chance for a bounce, the broader market structure still leans bearish unless Ethereum can reclaim and sustain levels above $4,100.
Investors are now closely watching Bitcoin’s price movement, as further weakness in BTC could drag Ethereum and other altcoins lower.
In the meantime, traders are advised to stay cautious, watch key resistance zones, and prepare for possible volatility. As the market consolidates, Ethereum’s ability to hold above major support levels will determine whether this downturn marks the start of a longer correction — or just another temporary setback in its broader uptrend.
