Ethereum tests critical support as $6.6 million clears near $2,250! Will ETH price fall again?
Bitcoin and Ethereum have continued to experience price declines in recent hours, signaling a weak start to the week. While this may be a standard correction ahead of a bull market, similar to patterns observed in past bull markets, there are growing concerns that whale investors may be selling for profits, delaying the expected bull phase. Ethereum in particular is experiencing increasing liquidations and is approaching a critical support level that can be tested.
ETH price ready to test $2,100
According to Coinglass, the liquidation of long positions increased significantly as the price of Ethereum plummeted from $2,250. In the last three hours alone, more than $6.6 million worth of long positions were liquidated. This is because investor confidence has declined since the drop from $2,250. In the same vein, Bitcoin experienced the liquidation of over $15 million in long positions, indicating continued selling and the potential for further price declines.
Whale investor interest in Ethereum has waned, with large transactions hitting a one-month low. IntoTheBlock reports that the number of large transactions has dropped sharply due to the drop in Ethereum prices. Currently, this indicator corresponds to approximately 2,65000 transactions.
Interestingly, as the price of Ethereum falls, some investors see this as a good moment to increase their holdings. According to data from CryptoQuant, Ethereum’s Netflow is negative, indicating that outflows of coins from exchanges are exceeding inflows. This trend suggests that despite the price decline, Ethereum’s foreign exchange reserves are declining as investors withdraw ETH to begin holding during the recent decline.
This trend could noticeably strengthen immediate support levels as Ethereum price approaches a test of the $2,100 level. Current market sentiment is generally bearish, with the long/short ratio standing at 0.8692. This indicates that 53.5% of positions expect the price to fall. On the other hand, 46.5% of positions maintain a bullish outlook despite increased selling pressure.
What’s next for ETH price?
Bearish traders are attempting to drive the price of Ethereum below the critical breakout level of $2,200, but bullish investors are defending this level. This indicates an effort by buyers to establish $2,200 as a new support level.
ETH price is showing extreme volatility near $2.2K as buyers attempt to push the price above EMA20. To recover the position, ETH price must remain within $2,400 and break the resistance level of $2,464. However, sellers are expected to aggressively defend this level.
The key support area to watch is between $2,200 and $2,100. A decline below this support could trap more aggressive bullish traders, potentially triggering a wave of liquidation of long positions. Such a scenario could trigger a sharp correction, sending the price down to $1,900.