Ethereum News Today: Ethereum's Price Plunge Reaches Make-or-Break $3,550 Support

Ethereum's price has plunged below $3,800 amid a bearish market trend, with key technical levels now in focus as traders assess the likelihood of further declines. The cryptocurrency failed to break past the $3,920 resistance, triggering a renewed sell-off that has pushed ETH below critical support zones, including the 100-hourly Simple Moving Average (SMA) and a rising channel with support at $3,840, as noted in ETH dips below $3,800. Analysts warn that if Ethereum cannot reclaim these levels, the next major target for sellers could be the $3,550 support, a critical threshold that has historically acted as a springboard for price recoveries, according to a TradingView analysis.

The recent breakdown below $3,800 has intensified bearish sentiment, with technical indicators reinforcing the downward momentum. The MACD for ETH/USD is gaining strength in the bearish zone, while the Relative Strength Index (RSI) remains below the neutral 50 level, signaling sustained selling pressure, according to The Currency Analytics. On-chain data also reveals that short-term holders are liquidating positions, though long-term investors remain steadfast, suggesting underlying confidence in Ethereum's long-term fundamentals, according to The Currency Analytics.

Market observers highlight the Fibonacci retracement levels as critical benchmarks. Ethereum has fallen below the 61.8% retracement of its recent upward move from $3,678 to $3,916, confirming the loss of short-term bullish momentum. A further drop below the 76.4% Fib level at $3,720 could expose the asset to deeper losses, particularly if broader market conditions remain weak, The Currency Analytics reports. Immediate resistance is clustered near $3,840 and $3,860, with a successful break above $3,920 potentially setting the stage for a retest of the $4,000 psychological barrier, according to the TradingView analysis.

The bearish scenario hinges on Ethereum's ability to hold key supports. If the $3,680 level fails, the next critical target is $3,650, followed by $3,550 and $3,500, as noted in the Holder coverage. A breakdown below $3,500 could push the price toward $3,450 or even $3,300, where stronger buying interest might emerge, The Currency Analytics suggests. Conversely, a sustained rebound above $3,920 could reignite bullish momentum, with potential targets at $4,000 and beyond, as discussed in the TradingView analysis.

Broader market dynamics are also influencing Ethereum's trajectory. The cryptocurrency's performance remains closely tied to Bitcoin, which has struggled to maintain gains above $110,000. Uncertainty around U.S. Federal Reserve policy and government budget negotiations has further dampened risk appetite, weighing on crypto assets, according to The Currency Analytics. Analysts suggest that a reversal in Ethereum's downtrend would require a combination of improved macroeconomic conditions, increased buying interest, and positive developments in the DeFi sector or ETF landscape, The Currency Analytics adds.

For now, traders are advised to monitor the $3,840 resistance and $3,680 support levels closely. A decisive move above $3,920 could mark the start of a fresh rally, but until then, caution remains warranted as the market digests evolving economic signals, the Holder coverage notes.