Ethereum News Today: Ethereum's $2,800 Support Test: Liquidity Reset or Prolonged Downturn?

Ethereum (ETH) appears to be stabilizing at critical support levels, with analysts and traders suggesting the asset may have bottomed near the $2,800 zone. A trader flagged this area as pivotal, noting that a breach of the 2,800-2,950 range could signal a breakdown in ETH's long-term bullish trajectory. Analyst Matt Hughes echoed this sentiment, emphasizing that ETH's recent drop to around $2,870 aligns with historical volatility patterns and remains within normal crypto-market bounds according to analysis.

The broader market context, however, remains turbulent. Bitcoin (BTC) and other top cryptocurrencies have seen sharp declines, with BTC slipping below $86,000 and ETH trading under $2,900. Technical indicators suggest oversold conditions for both assets. JPMorgan analysts attributed much of the recent sell-off to retail investors pulling $4 billion from spot BTC and ETH ETFs in November - a trend distinct from broader risk-asset retreats, as equity ETFs saw $96 billion in inflows during the same period according to JPMorgan analysis. This divergence highlights how crypto and equities are still treated as separate investment categories by many retail traders.

Despite the downward pressure, Ethereum's fundamentals remain resilient. Staking activity hit a record high in November 2025, with over 33 million ETH tokens locked in staking contracts. This surge in staking reflects long-term confidence in the network, even as short-term price volatility persists. Institutional accumulation also continues, with firms like BitMine Digital acquiring $72.5 million in ETH recently according to recent reports.

On-chain liquidity trends add nuance to the bearish narrative. Altcoin Vector noted that ETH's liquidity reset has repeated patterns seen in past major reversals. However, delayed liquidity recovery could prolong stagnation, increasing structural risks for the asset.

The crypto market's fear and greed index currently sits at 15/100, a level last seen in April before BTC's rebound to over $100,000. Derivatives data shows over $1 billion in leveraged futures liquidations in 24 hours, with long positions dominating the losses. Perpetual funding rates remain mildly positive for most tokens, suggesting bears are still in control.

While Ethereum's near-term trajectory remains uncertain, some analysts argue the market is primed for a rebound. If liquidity stabilizes and ETH reclaims key resistance levels, the asset could enter a new expansion phase. For now, traders are closely watching the $2,800 support zone and broader market sentiment for signs of a reversal.