Why Ethereum is Down Today: Will $2,400 Hold in the Next Drop?

Ethereum is under pressure as bearish forces take control again. With Bitcoin dropping below $96,000, ETH failed to hold its recovery, reversing from the $2,750 resistance. Weak technical signals, rising gas fees, and record-high ETH supply are fueling concerns of a potential drop to $2,400. While the outlook remains bearish under trend line resistance, there are still signs of a possible rebound.

Let’s take a closer look.

Ethereum Fails to Break $2,750

Ethereum’s recent rally lost momentum after failing to clear the key $2,750 resistance. The rejection led to a 2.9% pullback, bringing ETH down to $2,663. With the market still volatile, Ethereum’s price continues to form lower highs, signaling ongoing bearish pressure.

For now, ETH is holding support at $2,600. But if this level breaks, losses could accelerate, putting the $2,400 support in focus. The bearish outlook is further reinforced by a recent death cross between the 50-day and 200-day EMAs, along with a declining 100-day EMA.

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Can Institutional Demand Save Ethereum?

Despite its underperformance, Ethereum still has some bullish catalysts. U.S. spot Ethereum ETFs have recorded an inflow of 145k ETH in February, a significant jump compared to January. Additionally, Santiment reports that ETH’s supply on exchanges has dropped to an all-time low, suggesting strong accumulation.

If Ethereum manages to hold above $2,600 and sentiment shifts, a rebound toward $3,000 remains possible. However, if bears continue to dominate, ETH could soon test the $2,400 support zone.

Signs of Rebound?

According to Santiment’s X post, Ethereum is showing signs of recovery, climbing to $2,745 and outperforming most altcoins. A key factor behind this trend is the rapid movement of ETH from exchanges to cold wallets, with only 6.38% of its total supply now available for trading—the lowest since its inception. This is generally a positive sign as investors are holding onto their ETH, reducing selling pressure. Plus, market sentiment around Ethereum is improving after a weak 2024, with many anticipating a stronger rebound when broader crypto markets recover. 

However, they also note that this is a long-term indicator rather than something that directly impacts short-term price swings.

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