As Ethereum struggles below $2,100, its market momentum wanes.

As of Monday morning, Ethereum (ETH) was trading at about $2,051, below a crucial support level. The price of ETH/USD, the second-largest cryptocurrency by market capitalization, has dropped more than 5.5% in the last day, continuing a downward trend that saw the commodity drop by about 20% during the previous week.

Trump's Crypto Reserve and the Response of the Market

Part of the reason for Ethereum’s current problems can be attributed to the selling pressure that the market experienced as a result of President Donald Trump’s Executive Order establishing a Strategic Bitcoin Reserve. Traders were disappointed by the lack of immediate government buying pledges, despite the fact that the sequence represents a turning point in the acceptance of cryptocurrencies by institutions.

In a recent market update, Singapore-based digital asset trading firm QCP Capital stated, “The knee-jerk reaction lower probably stems from the realization that no actual budget has been allocated for Bitcoin purchases in the near term.”

The executive order establishes distinct reserves for Bitcoin, Ethereum, and other cryptocurrencies. However, due to its security and decentralizing qualities, the White House has blatantly positioned Bitcoin as meriting “special treatment,” creating uncertainty for Ethereum investors.

Technical Analysis of ETH/USD Indicates a Critical Support Level

According to a number of technical indications, Ethereum is at a pivotal point. For more than a year, the asset has shown consistent weakness by staying stuck below important resistance levels.

Despite multiple tries, Ethereum has failed to break above the quarterly Parabolic SAR indicator, indicating that “resistance won’t be broken” in the near future, according to renowned analyst Tony “The Bull” Severino. Ethereum’s rejection at the quarterly SuperTrend dynamic resistance, which validates buyers’ incapacity to restore market power, is further highlighted by Severino’s analysis.

For Ethereum holders, the crucial support at $2,100 is the most worrisome. A monthly closing below this level might have dire repercussions, per technical analysis of quarterly Bollinger Bands, which have monitored ETH’s price movement since February 2022. A breach below the lower Bollinger Band, which is now around $2,098, might lead to intensified selling.

A Potential Reversal Is Indicated by ETH Whale Accumulation

Despite the pessimistic technical outlook, on-chain data indicates significant institutional interest at present price levels. According to cryptocurrency analyst Ali Martinez, wallets holding over 100,000 ETH have been observed to accumulate over 330,000 ETH in just 48 hours, indicating that large investors find the current pricing attractive.

This accumulation pattern is consistent with a Wyckoff reaccumulation phase, according to some scholars. This technical pattern suggests that Ethereum may be entering the “Spring” phase, which is typically the final shakeout before a big increase in value

A Bullish Perspective Is Provided by Historical Comparison

Some market observers have drawn comparisons between Ethereum’s current price fluctuation and its 2016–2017 market cycle. According to analyst Merlijn, there was a similar consolidation phase during the 2017 rise, which was broken up by a fake-out before an accelerated ascent.

Despite its recent dip, Ethereum might be poised for a significant breakthrough if this historical tendency recurs. The immediate concern, however, is the asset’s ability to break above the critical $2,100 support level.

Forecast for the Price of Ethereum

The RSI on Ethereum’s daily chart is currently around 35, indicating a continued bearish trend, after rejecting around its neutral level of 50 last week. The MACD also shows a bearish crossover, which suggests that the downward trend will continue.

If ETH is unable to bounce back above $2,125, it may continue to decline until it reaches weekly support at $1,105. However, if the asset recovers above $2,125, it may encounter resistance at $2,359.

FAQ

Why is Ethereum struggling below $2,100?

Ethereum is facing downward pressure due to selling activity in the market, technical resistance levels, and uncertainty caused by President Donald Trump’s Executive Order establishing a Strategic Bitcoin Reserve. The lack of immediate government buying pledges has disappointed investors.

How does Trump's Executive Order impact Ethereum?

The order establishes reserves for Bitcoin, Ethereum, and other cryptocurrencies but gives Bitcoin special treatment due to its security and decentralization. This has created uncertainty among Ethereum investors, leading to market weakness.

What are the key technical indicators for Ethereum's price movement?

Ethereum has struggled to break above important resistance levels, including the quarterly Parabolic SAR and SuperTrend dynamic resistance. If ETH falls below the lower Bollinger Band at $2,098, it may face further selling pressure.

Could Ethereum experience a price rebound soon?

Despite bearish signals, large investors (whales) have accumulated over 330,000 ETH in the last 48 hours. This pattern aligns with a Wyckoff reaccumulation phase, which could signal a potential reversal in Ethereum’s price trend.

What is the price forecast for Ethereum?

If Ethereum fails to reclaim $2,125, it could continue to decline towards weekly support at $1,105. However, if it surpasses $2,125, the next resistance level to watch is $2,359, which could indicate a recovery.