While Bitcoin’s market capitalization reached new heights, Ethereum failed to break its previous all-time high in the ongoing bull market. ETH witnessed a disappointing 25% downtrend this week, slipping toward the $2400 support level. Following the drop, Ethereum quickly rebounded, but the high selling pressure forced it to move sideways.
Amidst these events, Ethereum’s co-founder Vitalik Buterin has expressed his gratitude to the community for increasing the efficiency of the ecosystem. Also, the project continues to HODL user engagement. Even though ETH hasn’t attained dominance in the market, the predictions from experts suggest the arrival of a pump soon.
Ethereum’s Current Market Scenario
At the moment, Ethereum (ETH) is at $2,637.66 with a market cap of 318.25 billion dollars. It showed a 24-hour trading volume of $20.34 billion. When this month began, ETH was trading around $3300 per coin. It dropped to $2462 and never rebounded to the previous price point. Since the recovery wave after the drop didn’t last, we can see more dips in the coming days.
Factors Contributing to ETH’s Decline
While some recent updates have increased the efficiency and a reduction in gas fees, investors are still hesitant to buy ETH. In fact, even some of the long-term holders have been selling the coin lately. In the futures market, open interest in the ETH/USDT pair has decreased. The short positions have surged, increasing the risk of high volatility.
According to various blockchain experts, this decline is due to the efficiency of Ethereum alternatives. New web3 users are flocking into chains such as Solana, Binance Smart Chain, Avalanche, Base, and Cardano. Also, the investors are questioning Ethereum’s adaptability in the long term.
Another factor that contributed to the price decline is the postponement of the SEC’s decision on the latest Ethereum ETF approvals. The investors expected the SEC to finalize the decision at the beginning of 2025. But, according to the recent reports, we have to wait until April 2025 for a definitive decision. This delay has caused uncertainty in the ETH market.
How Low Can ETH Go? Insights From Charts
If ETH maintains the $2640 zone, we can expect a breakthrough to $3000 levels. Or even reaching $3500 or $4000. However, the probability is higher for a sudden crash in the next few days, which can later result in a surge. Most likely, ETH will fail to hodl the above-mentioned zone and will crash again to the $2400 or $2120 level.
On the other hand, various X users pointed out that surprisingly, the indicators of the 2020-2021 market and the 2024-2025 market are so close that we might see the 2021 scenario recurring. According to these users, ETH will fall for two more weeks, and then a potential upside can be witnessed. Let’s check Ethereum’s current Support and Resistance Levels:
- ETH 1st Resistance Point: $2,727.658
- ETH 2nd Resistance Point: $2,868.411
- ETH 3rd Resistance Point: $2,940.567
- ETH 1st Support Point: $2,514.749
- ETH 2nd Support Point: $2,377.397
- ETH 3rd Support Point: $2,154.283
Final Thoughts: Ethereum’s Future
Despite the recurring dip in the prices, the increasing institutional adoption due to climate-friendly PoS consensus will likely make ETH a strong crypto project in the coming decade. The deflationary mechanism, institutional staking, and improved scalability will probably increase the market capitalization of the project in the long run.
Finally, if you plan to trade, try to make an extensive study on ETH to determine the accurate entry and exit points. As a market with recurring cyclical volatility, always DYOR and increase your awareness!
