Ethereum (ETH) has hit a crucial point, testing its multi-year support levels after a significant price decline. This drop, largely triggered by macroeconomic factors and a broader market downturn, has left Ethereum struggling to maintain momentum. Following a sharp dip below $2,000, many investors are left questioning whether Ethereum can make a swift recovery or if further losses are in store.
Ethereum has been caught in a sharp decline recently, with its price dropping significantly within a short period. In the past 24 hours alone, Ethereum witnessed long liquidations totaling over $600 million, far surpassing Bitcoin’s $411 million. These liquidations, including the notable ETH/BTC transaction worth $25.64 million, have fueled the bearish sentiment that currently hangs over Ethereum.
However, not all hope is lost for ETH holders. A whale investor known as “7 Siblings” capitalized on the drop, spending over $100 million to acquire 45,047 ETH at an average price of around $2,480. This purchase has provided some temporary stability, allowing Ethereum’s price to recover slightly above the $2,500 range. Still, Ethereum must maintain levels above $2,500 to avoid further declines, with $2,800 serving as a crucial resistance level for a more substantial price recovery.
The ongoing trade tensions between the U.S. and its trading partners, particularly China, Canada, and Mexico, have exacerbated economic uncertainty. New tariffs imposed by the U.S. on goods from these countries have added inflationary pressure to the markets. As a result, both traditional and cryptocurrency markets have been negatively impacted. Bitcoin, often seen as a safe haven in such times, has also seen its price drop below $91,000, mirroring Ethereum’s struggles.
As tariffs escalate and global trade tensions continue, the broader crypto market faces headwinds. Ethereum, as the second-largest cryptocurrency, is inevitably affected by these external pressures. The combination of geopolitical risks and market volatility has put Ethereum’s price at risk of further declines, leaving many wondering whether the altcoin season will be delayed.
The broader market conditions have also influenced Ethereum’s dominance in the crypto space. Bitcoin’s dominance has increased as its price stabilizes, while Ethereum’s dominance has decreased sharply, falling from around 20% to 10%. Ethereum’s price also failed to break above the crucial $3,000 mark recently, leading to a breakdown in its price correlation with Bitcoin.
The recent market correction has created doubt about the potential for an Altseason in 2025. While altcoins surged in 2024, Ethereum and other altcoins have seen a pullback as Bitcoin has reclaimed dominance. Ethereum’s position in the market has weakened as Bitcoin rallies, and the recent price action suggests that the road to Altseason might be further delayed.
Despite the market downturn, there is still potential for Ethereum to recover. A macro-buy signal for Ethereum has been triggered, signaling that the token could see a price bounce in the near future. To regain upward momentum, Ethereum must first secure its position above key support levels like $2,500 and $2,800. A failure to maintain these levels could lead to a steeper drop toward $2,000 or even lower.
On the other hand, if Ethereum manages to reclaim these levels and rally above $2,800, a potential recovery towards higher price points could occur. The ongoing accumulation by large investors, like the whale who purchased 45,047 ETH, also suggests that institutional interest in Ethereum remains strong.
In conclusion, Ethereum is at a pivotal moment. While the macroeconomic environment and competition from Bitcoin have created significant challenges, there is still hope for a price recovery if Ethereum can hold crucial support levels. Investors will need to monitor Ethereum’s performance closely to determine whether the recent downturn is a temporary setback or the start of a more prolonged decline.
Get the latest Crypto & Blockchain News in your inbox.