Ethereum (ETH) has faced a steep sell-off over the weekend, dropping below the crucial $3,000 psychological level. This sharp decline triggered $613 million in liquidations over just 30 hours, leading to concerns among investors. Let’s take a closer look at why Ethereum is crashing and what lies ahead for ETH and the broader altcoin market.
Why is Ethereum’s Price Crashing?
The latest downturn in Ethereum’s price can be attributed to a combination of market factors, starting with Bitcoin’s own plunge to $91K. Bitcoin’s collapse set off a ripple effect throughout the cryptocurrency market, causing Ethereum to drop by 25% in just 12 hours, reaching a low of $2,125. This dramatic drop came amid growing fears around global trade tensions. On Friday, President Trump signed an executive order imposing a 25% tariff on imports from Mexico and Canada, along with a 10% tariff on Chinese goods, which will take effect on Tuesday. These economic shifts have left markets on edge, further exacerbating the crypto sell-off.
Key Levels to Watch for Ethereum
As Ethereum struggles, its price has broken through key technical levels. The falling wedge formation that ETH had formed collapsed, leading it below $3,000 and triggering a dip to the $2,150 level. Despite this, ETH has seen a slight rebound, recovering 20% from its swing low of $2,080 to trade around $2,500 at press time. For those looking to navigate the market, the immediate support level is now $2,341, while resistance levels to watch include $2,657, $3,057, and beyond.
What’s Next for Altcoins?
Given Ethereum’s recent dip, the outlook for altcoins remains uncertain. Crypto analyst CryptoCapo hinted that an “alt season” could be on the horizon, despite ETH’s recent volatility. Many altcoins, including Popcat and Dogwifhat, have experienced over 50% drops in recent weeks, with some falling as much as 90% from their peaks. However, if Bitcoin continues its bullish trend, altcoins could see a recovery, aligning with historical data suggesting February post-halving years are often bullish for the market.
Also Read: Ethereum (ETH) Poised for 200% Surge: Analysts Predict Major Rally in February
In summary, while Ethereum faces a tough period, the long-term outlook for both ETH and altcoins may turn positive if Bitcoin sustains its bullish momentum.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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