Ethereum Tests Crucial Demand Level Amidst Bearish Storm

Ethereum, the second-largest cryptocurrency by market capitalization, has experienced a significant drop in recent days, losing over 27% of its value in less than five days. This rapid sell-off has fueled speculation that a bear market could be on the horizon, with many analysts calling for further downside in the coming months. However, despite the overwhelming bearish sentiment, there is still a chance for Ethereum to recover as the price is now testing a crucial demand level.

Top analyst BigCheds shared a technical analysis, noting that Ethereum is reapproaching a critical monthly demand level, which could define the cryptocurrency's next major move. Historically, price reactions at this level have led to either a strong bounce or further capitulation, making the current market conditions a pivotal moment for Ethereum's long-term trajectory.

Ethereum is currently trading below $2,200, struggling to regain momentum after a severe market-wide correction. The altcoin sector continues to bleed, and ETH has now lost nearly 50% of its value since peaking at $4,100 in mid-December. Bulls face a critical test as they must defend key demand levels to prevent further selling pressure and attract strong buying interest.

BigChed's insights highlight that Ethereum is now re-approaching a key high-timeframe demand zone of around $2,000. According to Cheds, this is a must-hold level—losing this zone could trigger a deeper correction, while a strong defense could pave the way for a potential recovery rally. The next few days will be crucial for Ethereum. If bulls manage to reclaim $2,200 and push toward $2,500, a reversal could take place. However, failure to hold $2,000 could see ETH drop further, potentially testing lower demand zones in the coming weeks.

Ethereum is trading at $2,120 after enduring days of massive selling pressure that pushed the price to its lowest level in months. ETH is currently holding above a high-timeframe demand level around $2,000, a crucial zone that must be defended to avoid further downside. However, sentiment remains fragile, and if Ethereum fails to hold this level, it could trigger a dramatic sell-off leading to even lower prices.

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