Ethereum (ETH) Faces Critical Breakdown: Can Bulls Hold $2,000?

Ethereum (ETH) declined on Wednesday, February 4. The token is trading at $2,254. This represents a decline of 1.08% in the past 24 hours. The trading volume increased by 32.58%, reaching $46.32 billion. The asset has declined by 25.75% over the last week, according to CoinMarketCap.

Source: CoinMarketCap

Ethereum Nears Critical Zones With Risk of Further Drops

Analyst Umair Crypto highlighted that the drop below $2,600 happened faster than expected. ETH has declined by 15–20% from the $2,600 zone. The analyst noted that the decline from the $3,000 mark has reached almost 30%.

According to Umair Crypto, the asset is currently resting on the last soft spot before weaker support levels. There is a lack of structural support below $2,100 except for the $2,000 psychological mark. The technical support appears again only around $1,800.

Source: X

The failure of the current zone might result in further declines for the token. According to Umair Crypto, the continuation of the price might result in a decline toward $1,800. The analyst noted that a further dip below $1,600 is also possible.

In addition, another analyst, Ted Pillows, mentioned that ETH continued trading above $2,000 in Tuesday’s trading session. According to Ted, for cryptocurrency to start rallying, it has to overcome resistance at $2,400. However, the current price strength appears limited.

Source: X

Also Read: Litecoin (LTC) Eyes $64 Breakout as Market Volatility Fuels Altcoin Momentum

ETH Sees Fresh ETF Inflows and Higher Trading Volume

According to SoSoValue data, $14.06 million in net inflows has been recorded in Ethereum spot ETFs on February 3. The market records these inflows following a series of outflows. 

CoinGlass data shows that volumes increased by 44.51% to $101.95 billion. Open Interest declined by 1.57% to $26.90 billion, while the OI-Weighted Funding Rate stood at 0.0049%.

Source: CoinGlass

RSI and MACD Show Strong Downward Momentum

The RSI indicators show that the coin has declined significantly. The Relative Strength Index (RSI) stands at 26.48. This indicates that the coin has been oversold. However, the signal line stands at 34.90, also confirming that the token has declined significantly.

The Moving Average Convergence Divergence (MACD) line stands at -212.2. The MACD signal line stands at -131.8. However, the histogram stands at -80.4, highlighting continued negative momentum.

Source: TradingView

The market conditions for the price of the token are still volatile. Analysts are looking at the support levels for the asset. The upcoming sessions will show whether the asset will stabilize or move to the lower zones.

Also Read: Ethereum Technical Setup Points to $2,400 Target Amid Market Volatility