Ethereum Plummets 13.40% Amid Market Turbulence, $330M Liquidated

Ethereum (ETH) experienced a significant price drop of 13.40% over the past week, causing considerable market turbulence. The cryptocurrency's price volatility has led to substantial liquidations, with over $330 million in positions being wiped out. This event has sparked intense analysis among market participants, who are closely monitoring technical indicators and price patterns to gauge Ethereum's next potential move.

Analysts have identified a falling wedge pattern in Ethereum's price chart, which is generally considered a bullish signal. This pattern suggests that if ETH can break above the resistance zone, a price recovery could be imminent. However, for this to occur, ETH must first break and hold above a key resistance level, which could pave the way for a move towards the $2,000 region. Despite this potential bullish signal, the ETH/BTC ratio remains near multi-year lows, indicating that the market is still cautious about Ethereum's prospects.

Adding to the uncertainty, some analysts offer a bearish perspective, suggesting that if momentum falters, ETH could see a move down toward $800. This conflicting view highlights the volatility and unpredictability of the cryptocurrency market, where both bullish and bearish scenarios are possible.

The impact of leverage trading on Ethereum's price movements is evident in the Total Liquidations Chart. Significant liquidation spikes occur around crucial price zones between $2,000 and $3,000, with the highest liquidation levels surpassing $330 million. These spikes reveal aggressive leveraged positions getting wiped out, reinforcing the high-risk nature of leveraged trading. A large long liquidation spike coincided with a sharp price drop, underscoring the potential for massive losses in leveraged positions.

From a technical standpoint, Ethereum's Relative Strength Index (RSI) is around 33.29, nearing oversold territory. An RSI below 30 typically signals that an asset is undervalued, potentially setting the stage for a price rebound. However, the Moving Average Convergence Divergence (MACD) remains negative, with both the MACD line and signal line below zero. This confirms bearish momentum, but a crossover could indicate a trend reversal. Therefore, while the RSI hints at a possible bounce, the MACD is still flashing warning signs, adding to the overall market uncertainty.