Analyst Predicts Ethereum Could Drop to $2,800 Support Level in Continued Market Downturn

Yesterday, Ethereum faced a rapid drop in value along with the rest of the cryptocurrency market. ETH prices plummeted by more than 9% within a few hours, causing concern among investors about a potential deeper decline. The sudden downturn has created fear in the U.S. markets, adding to the uncertainty surrounding the crypto space on this Monday morning.

A well-known crypto analyst, Carl Runefelt, provided a technical analysis on X, shedding light on Ethereum’s current delicate situation. According to Runefelt, if the market continues its downward trend, Ethereum might test the $2,800 support level today. This level is crucial for ETH, and breaking it could lead to further declines and increased selling pressure.

Market sentiment has been impacted, as investors anticipate higher volatility in the upcoming days. Analysts are closely monitoring macroeconomic indicators and broader market movements to assess their potential impact on Ethereum’s price movement. With ETH hovering around key support zones, the next 24 to 48 hours will be pivotal in determining whether the cryptocurrency can regain momentum or face a more significant correction. Investors are advised to proceed with caution during this volatile phase.

Ethereum Under Pressure from Selling

Since late December, Ethereum has been experiencing significant selling pressure, reflecting the overall heightened volatility in the broader cryptocurrency market. Both analysts and investors are growing increasingly bearish, suggesting that ETH’s downward trend may continue in the coming days. This challenging period has raised doubts about the asset’s short-term future, leaving many market participants on edge.

Renowned crypto analyst Carl Runefelt shared his technical analysis on X, emphasizing a critical support level for Ethereum. Runefelt forecasts that if the current market downturn persists, Ethereum could reach the $2,800 support level. This level could either provide a strong base for a potential recovery or indicate further weakness if breached.

Despite the prevailing bearish sentiment, some investors and traders view a potential drop in Ethereum’s price as an opportunity. Ethereum remains a major cryptocurrency, and many believe it still has significant growth potential in this cycle. A correction to $2,800 could present an attractive entry point for those who have faith in Ethereum’s long-term fundamentals and growth prospects.

As the market continues through this uncertain phase, all attention is focused on Ethereum’s price action. Whether it can hold onto crucial support levels or succumb to increased selling pressure will be instrumental in shaping its trajectory in the coming weeks.

Price Stability Above Key Support

Currently, Ethereum (ETH) is trading at $3,050, just above the 200-day moving average of $2,988. The 200-day moving average is typically seen as a long-term strength indicator, and maintaining a position above this level could signal a possible reversal of the current downtrend.

The market is closely watching to see if Ethereum can retain this critical support, as it could mark the beginning of a potential recovery phase. Analysts emphasize that staying above the 200-day moving average is crucial for building bullish momentum and restoring investor confidence in the short term.

However, holding support is just the initial step. To confirm a trend reversal and establish a stronger bullish outlook, Ethereum must reclaim the $3,300 resistance level. This would indicate that buyers have regained control, potentially opening the path for further upward movement.

Conversely, if Ethereum fails to hold above the $2,988 level, it could face intensified selling pressure, potentially testing lower support levels. As the market navigates this crucial juncture, the next few days will be pivotal in determining whether Ethereum can sustain its current levels and make a push towards higher territory. At present, traders and investors maintain a cautious sense of optimism.

Featured image from Dall-E, chart from TradingView

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