Ethereum price retreated to the lowest level since August 6 as the recent crypto market crash continued and liquidations jumped.
Summary
- Ethereum price has crashed this week as liquidations soared.
- The weekly liquidations jumped to almost $1 billion.
- Technical analysis points to a 16% plunge in the near term.
Ethereum (ETH) fell to $3,800, down 20% from its highest point this month. Its decline has mirrored the performance of other top cryptocurrencies like Bitcoin (BTC) and Ripple (XRP).
Ethereum price crashed as liquidations jumped
One of the main reasons why ETH price plunged is that liquidations jumped to almost $1 billion this week. Bullish positions worth over $490 million were liquidated on Monday as the crypto market crash intensified.
Another $413 million in positions were liquidated on Friday, and about $50 million earlier in the week. Liquidations occur when exchanges close leveraged positions after margin or collateral is exhausted.
Ethereum price also crashed as exchange-traded outflows jumped. All spot Ethereum funds shed more than $547 million in assets after they added $556 million a week earlier. Rising outflows are a sign of waning demand among institutional investors in the United States.
The drop also followed profit-taking and renewed concerns about the Federal Reserve. Several officials, including Beth Hammack, John Williams, and Raphael Bostic, warned that additional rate cuts could make inflation stickier.
Inflation jitters increased on Thursday after Donald Trump announced more tariff measures. He plans to add tariffs on imported drugs, pharmaceuticals, and other items such as furniture.
Still, Ethereum has some potential bullish catalysts, including the possible entry of Vanguard into the crypto industry, the upcoming Fusaka upgrades, and the start of retirement fund investments in crypto.
ETH price technical analysis
The daily timeframe chart shows that Ethereum pulled back from this month’s high of $4,978 to below $4,000 today.
It has moved below the 23.6% Fibonacci retracement level and the 50-day exponential moving average.
The decline followed the formation of a triple-top pattern with a neckline at the 23.6% retracement level. The distance between the triple-top point and the neckline is about 15%.
Measuring the same distance from the neckline points to a drop to $3,300, which coincides with the 50% retracement level. The bearish forecast will become invalid if price moves above resistance at $4,400.