Ethereum has been hit hard, dropping 55% from its December peak as the broader crypto market struggles with global economic uncertainty.
This downturn is largely driven by US President Donald Trump’s unpredictable economic stance and aggressive tariff policies, which have weakened investor confidence and heightened risk aversion.
As a result, Ethereum’s price has fallen below critical support levels, with sellers dominating short-term trading.
Despite the bearish outlook, some data points hint at a potential long-term recovery. CryptoQuant reports a steady decline in Ethereum reserves on centralized exchanges since 2022, indicating reduced supply. While this hasn’t triggered a rally yet, it could pave the way for a price surge if demand increases.
Currently, Ethereum is testing key support around $1,800 after weeks of selling pressure. Falling below this level could signal deeper losses, especially as economic factors remain challenging. Bulls have struggled since February, failing to regain momentum after dropping below $2,500.
From a technical perspective, Ethereum remains below significant indicators, such as the 200-day moving average ($2,500) and the exponential moving average ($2,250), highlighting ongoing weakness.
Maintaining the $1,800 threshold is crucial to avoid further declines, while reclaiming $2,000 could signal a potential recovery. For now, the reduced supply hints at long-term potential, but the immediate outlook remains fragile.
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