Iran Risk, Hawkish Fed and ETF Outflows Weigh on Ethereum as It Defends $1,900 with Warning of Drop to $1,500

▲ Ethereum (ETH), Decline / AI-Generated Image ©

Ethereum has staked everything on defending the $1,900 level, but concerns about a retest of $1,500 remain alive. Short-term charts have broken down and capital flows have cooled, yet the network’s fundamentals and long-term roadmap appear to be holding firm.

According to Trading News on February 22 (local time), Ethereum (ETH) has been fluctuating in the $1,960–$1,990 range amid six consecutive weeks of bearish candles. It has fallen about 40% over the past month, leaving a wide gap from its all-time high of $4,943. In the past 24 hours alone, approximately $35.4 million in positions were liquidated, including about $18 million in short positions. Although a short-term rebound occurred, analysts say it is difficult to view this as a signal of a trend reversal.

Technically, the bearish structure is clear. The breakdown of the $2,145 support level invalidated the previous reversal pattern, and the 20-day exponential moving average (EMA) at $2,123 has turned into resistance. Prices remain below the 50-week and 200-week moving averages. Key upside resistance lies between $2,050 and $2,107, followed by $2,123 as a critical pivot zone. On the downside, after short-term support at $1,880–$1,900, further levels stand at $1,741 and $1,524, with the $1,500–$1,404 range viewed as a high-risk testing ground. Although the Relative Strength Index (RSI) has rebounded from oversold territory, it is interpreted more as a technical bounce within a bear market rather than a trend reversal.

Capital flows are also a burden. Ethereum spot ETFs have recorded cumulative net outflows exceeding $450 million over the past month, with one day alone seeing $130 million exit. Outflows have continued for four consecutive months. Open interest in the futures market has shrunk from about $41 billion at the beginning of the year to around $23 billion, indicating reduced leverage exposure rather than expansion. Ethereum’s high correlation with Bitcoin also means that, as a high-beta asset, it tends to suffer larger declines during market downturns.

Macro conditions are not favorable either. Rising speculation over potential U.S. military action against Iran has fueled concerns about higher oil prices and renewed inflationary pressure. This increases the likelihood that the Federal Reserve will maintain a hawkish stance, strengthening the dollar and weighing on risk assets broadly. The fact that cryptocurrencies have recently moved more like risk assets than safe havens is also adding downward pressure.

However, on-chain metrics and the long-term roadmap paint a different picture. Total value locked (TVL) in DeFi remains at all-time highs in ETH terms, and the staking queue continues to expand. Ethereum maintains its dominance in stablecoin payment infrastructure and the tokenization of real-world assets. The “cypherpunk bolt-on” upgrade roadmap proposed by Vitalik Buterin aims to enhance decentralization, privacy, and censorship resistance, outlining a structural evolution over the next five years. While this may not immediately impact short-term prices, it is seen as supporting a medium- to long-term premium.

In summary, Ethereum is at a crossroads where strong fundamentals clash with negative capital flows. Unless it regains and stabilizes above the $2,100–$2,150 range, short-term downside pressure is likely to persist. A break below $1,741 would increase the probability of testing $1,500, whereas a confirmed weekly close above $2,150 could open the door to a full-fledged reversal scenario.

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