Ethereum Drops 5% Amid Tariff Announcement, Analysts Predict Parabolic Rally

Despite the current pessimistic sentiment surrounding Ethereum (ETH), crypto analyst Mister Crypto has predicted a potential parabolic rally for the second-largest cryptocurrency by market cap, drawing parallels to its historical price action from 2020. Following the announcement of reciprocal tariffs by former US President Donald Trump, the crypto market experienced a significant decline, with ETH dropping by 5% and potentially setting new cycle lows around $1,700.

Mister Crypto suggests that while retail investors may have lost confidence in ETH, large investors, or "whales," continue to hold onto the asset. The analyst shared a chart illustrating the similarities between ETH’s current price trajectory and its 2020 performance, indicating that if history repeats itself, ETH could see strong bullish momentum in the second quarter of 2025.

CryptoGoos, another analyst, agrees with Mister Crypto’s perspective, stating that ETH is currently undervalued. CryptoGoos provided data showing that wallets holding between 10,000 and 100,000 ETH have been accumulating the asset at an accelerated rate since early 2025, despite ETH’s decline from approximately $3,350 in January to around $1,700 at the time of writing.

Crypto Caesar, another analyst, noted that ETH is likely approaching a bottom, as it is currently trading near the same price level it held four years ago. However, he cautioned that if ETH breaks below its current support, it could decline further to the $1,200 range.

While whale accumulation suggests long-term optimism for ETH, some analysts warn that further downside may be imminent before a potential recovery. Cryptododo7 predicts that ETH may eye bearish targets around $1,130 to $1,200. Similarly, CryptoBullet highlighted that ETH has now touched the 300-week moving average for only the second time in its history – an event that has historically signalled a bearish trend.

Despite these cautionary outlooks, market commentator Titan of Crypto recently stated that ETH is still on track to reach new all-time highs later this year. At press time, ETH trades at $1,777, down 5% in the past 24 hours.