Ethereum Plunges 38% Since Start of Year, Faces Worst February—Heading to $1,600?

▲ Ethereum (ETH), Bear Market, Decline/ChatGPT-Generated Image ©

Ethereum (ETH) has fallen to the $1,800 level, plunging 38% year-to-date, and now stands at a crossroads—either heading toward $1,600 or rebounding to $2,100.

According to Trading News on February 24 (local time), Ethereum recently failed to break through the $2,100 resistance level and subsequently lost support at $1,928 and $1,900, trading in the $1,800–$1,825 range. The asset has declined 38% so far this year, with a nearly 25% drop in February alone, marking one of the worst February performances in the past decade. Spot Ethereum ETFs recorded $112 million in net outflows last week. Although this was lower than the previous week’s $162 million outflow, the capital flight trend continues.

On the daily chart, the price remains within a clear downward channel and continues to trade below the 100-day and 200-day moving averages, maintaining a bearish structure. The Relative Strength Index (RSI) is approaching oversold territory, but analysts say it is too early to interpret this as a trend reversal signal. The key inflection zone lies at the $1,750–$1,800 horizontal support range. Holding this level could enable a recovery attempt toward $2,000–$2,200, but a breakdown could open the path to $1,600 and potentially the $1,500 range.

Defensive positioning is also evident in the derivatives market. Perpetual futures funding rates on major exchanges have turned distinctly negative following February’s sharp decline, indicating a dominance of short positions. This structure increases downward pressure while also implying the possibility of a short squeeze if spot buying emerges around $1,750–$1,800. Analysts suggest that if the price reclaims $1,900 while funding rates remain negative, forced short covering could be triggered.

On-chain indicators are sending more mixed signals. The proportion of holdings aged three to six months has increased by about 5% over the past week, suggesting that some short-term holders have shifted to mid-term holding. Meanwhile, the 30-day Market Value to Realized Value (MVRV) ratio has shown signs of rebounding from deep negative territory around the $1,800 level, forming a pattern similar to previous localized bottoms. At the same time, the amount of ETH deposited in staking contracts has increased, reducing liquid supply.

The market reaction to large-scale purchase news has been limited. BitMine acquired 51,162 ETH, worth approximately $93 million, but the price failed to reverse its trend. Signs emerged that some long-term wallets used the liquidity to reduce their holdings, highlighting that macroeconomic uncertainty and weakened investor sentiment still dominate. Trading News maintained a short-term bearish bias below $1,880–$1,900 while viewing the $1,600–$1,750 range as a medium-term accumulation zone.

Disclaimer: This article is for investment reference only and does not assume responsibility for any investment losses resulting from its use. The information should be interpreted for informational purposes only.