Ethereum News Today: Bitcoin and Ethereum Battle Critical Support Levels in Crucial Market Test

Bitcoin and Ethereum experienced significant price declines in early October 2025, with Bitcoin dropping below $119,000 and Ethereum falling beneath $4,100, triggering renewed discussions about market dynamics and technical resistance. The moves followed a period of heightened volatility and profit-taking after both assets reached record highs.

Bitcoin (BTC) traded below $119,000, a level previously viewed as a critical support zone, after reaching an all-time high of $126,199 in late September. The decline, driven by overbought conditions and a bearish divergence on the RSI, marked a 4.2% drop in 24 hours. Analysts noted that institutional inflows into spot ETFs-surpassing $3.2 billion in the prior week-had initially fueled the rally but also attracted profit-taking.

Technical indicators suggest a mixed outlook. The RSI stabilized near 37.45, indicating limited downside momentum, while the MACD histogram remained bearish in the short term. Key support levels now include $107,350 and the 200-day SMA at $101,194. A break below $106,500 could trigger deeper corrections, according to analysts at Blockchain.News. Conversely, a rebound above $111,517 could reinvigorate the upward trend, targeting $117,440–$119,849 in the medium term.

Ethereum (ETH) fell below $4,100 after failing to break through resistance at $4,800, a level that had been tested multiple times in late September. The drop, a 3% decline in 24 hours, was attributed to weak spot demand and declining on-chain activity. Ultrasoundmoney data revealed a surge in Ethereum's circulating supply, while on-chain metrics showed a bearish divergence on the four-hour chart.

Support levels for ETH now include $4,400–$4,420, with a breakdown potentially exposing the token to $4,250 or $4,100. Analysts at CoinCentral noted that exchange reserves had fallen to 16.1 million ETH-a 25% decline since 2022-reducing available supply but not offsetting weak buying pressure. The 50-day SMA at $4,100 is a critical near-term level; a sustained break below it could lead to further consolidation or a test of the 100-day SMA.

The broader crypto market, with a total cap of $4.18 trillion, cooled after a week of record highs, as traders locked in gains. Bitcoin's institutional demand remained robust, with spot ETF inflows exceeding $1.2 billion in early October. However, some analysts warned of potential short-term corrections, citing historical patterns during U.S. government shutdown risks and ETF-related volatility.

For Ethereum, the decline coincided with a shift in institutional sentiment. SosoValue reported $389 million in net outflows from ETH-focused ETFs in October, signaling waning confidence. Despite this, long-term optimism persists, with Tom Lee of Fundstrat projecting a potential $10,000–$12,000 target by year-end, driven by Ethereum's scaling progress and institutional adoption.

The immediate trajectory for both assets will hinge on key resistance levels and macroeconomic factors. For Bitcoin, a successful defense of $111,517 could reignite bullish momentum, while a breakdown below $106,500 may extend losses. Ethereum's ability to reclaim $4,500 and sustain above the 50-day SMA will determine whether it resumes its upward trend or enters a deeper correction.

Market participants also remain attentive to October's historical performance, with Bitcoin historically averaging 21% gains in the month and Ethereum showing strong Q4 recoveries. However, the current environment is marked by mixed signals, including ETF-related uncertainty and shifting institutional flows, which could prolong volatility.