Ethereum price breaks key support as liquidations trigger sharp sell-off

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Highlights

Ethereum fell more than 7% in a single session, losing key technical support amid a broader risk-off move.
Over $800M in ETH long positions were liquidated as leverage unwound rapidly.
Weak spot demand and declining on-chain activity amplified downside momentum.

Ethereum extended its sharp decline, breaking below the critical $2,400 support level and briefly touching an intraday low near $2,180. The move marked Ethereum’s weakest price level since early spring and confirmed a broader bearish technical structure, as selling pressure intensified across the crypto market.

At current levels near $2,300, ETH is trading well below its 50-day and 100-day moving averages, signaling a clear shift in short-term trend. The breakdown followed Bitcoin’s sharp drop below $80,000, which triggered cascading liquidations across major altcoins. Ethereum’s market capitalization fell below $270 billion, erasing most of its early-January gains.

ETH daily chart. Source: TradingView

From a technical perspective, ETH decisively lost the $2,400–$2,350 demand zone, which had acted as support multiple times over the past two months. The next significant support lies near $2,100, with a deeper downside risk toward the psychological $2,000 level if selling pressure persists.

"Ethereum has confirmed a bearish technical breakout, and until it regains lost support, uptrends are likely to sell off. Short-term volatility remains high, and the $2,000 level is currently a critical psychological zone for buyers," said analyst Viktoras Karapetyants.

Liquidations accelerate as leverage collapses

The decline triggered one of the largest Ethereum liquidation events of the month. Within 24 hours, more than $800 million in ETH positions were liquidated, with long positions accounting for over 85% of the total. At the peak of volatility, forced liquidations exceeded $300 million in a single hour, highlighting how crowded bullish positioning had become.

Funding rates flipped sharply negative across major derivatives exchanges, reflecting a sudden shift in trader sentiment. Open interest also dropped significantly, confirming aggressive deleveraging rather than organic selling alone.

Technical indicators confirm bearish momentum

Momentum indicators paint a decisively bearish picture. The daily RSI dropped below 30, entering oversold territory for the first time since last year’s correction. Meanwhile, the MACD histogram expanded deeper into negative territory, signaling strengthening downside momentum rather than a relief bounce.

Volume spiked sharply during the breakdown, validating the move as a high-conviction sell-off rather than a temporary liquidity sweep. Until Ethereum reclaims the $2,400 level, technical rallies are likely to face strong selling pressure.

Weak fundamentals add pressure

Beyond technicals, Ethereum has faced declining network activity, with lower transaction fees and reduced demand for block space weighing on sentiment. Staking inflows have slowed, while ETH/BTC continues to trend lower, reflecting underperformance versus Bitcoin during periods of market stress.

With macro uncertainty and fragile risk appetite dominating markets, Ethereum remains vulnerable to further downside. While a short-term oversold bounce is possible, the broader structure suggests consolidation or continued weakness unless buyers step in decisively.

As we wrote, Crypto market recap: Bitcoin and Ethereum fall as uncertainty grows

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