A day after Trump announced the inclusion of Ethereum in the US crypto reserve, the top altcoin is back to losing ways. Over the last 24 hours, ETH plunged 15%, crashing below $2000 and causing the liquidation of $209 Million worth of ETH trades.
The last 48 hours have been wildly dramatic for Ethereum. The top altcoin started by reigniting investor interest when it rallied by more than 16% after Trump announced its inclusion in the much anticipated US Strategic Reserve.
The positive was given a further boost by the news that Trump would be holding the first white house crypto summit at the end of the week.
Ethereum bulls were, however, unable to sustain this bullish momentum, and the altcoin plunged by more than 15% over the last 24 hours. This has led to the forceful liquidation of thousands of ETH trades worth more than $209 Million – mostly longs.
With today’s losses, ETH is down by more than 36%, wiping all the gains made in the last half of 2024 to trade at lows last seen in November 2023. If this trend is sustained, ETH will record its worst first-quarter performance in history.
Factors Behind the Market Crash?
Ethereum’s price has declined over the past three months, struggling against Bitcoin amid weak investor sentiment.
Factors like reduced institutional demand, inflation, stock market volatility, and trade uncertainty have heightened caution, dampening risk appetite. According to data from Coinglass the top altcoin’s open interest fell by 10.8% to 8.8 Billion.
How Low Can Ethereum Go?
At the time of writing, Ethereum has regained its footing and is currently holding above the critical $2000 support level. However, a break below this level could trigger a significant downtrend, potentially pushing ETH towards $1540, $1000, and even as low as $174.
This bearish projection is based on a double-top pattern observed on the weekly chart, with the $2000 level representing the neckline.
A breakdown from this pattern could lead to a substantial decline, highlighting the importance of the ongoing battle for $2000.
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