3 Reasons Why Ethereum (ETH) Could Drop to $2,000

The largest altcoin by market capitalization has plunged roughly 15% over the past month and currently trades just above $2,300. The recent downturn has sparked pessimism, with some analysts warning that the asset could slide further to the key psychological level of $2,000. At the same time, certain factors suggest a resurgence may be just around the corner.

The Bearish Perspective The popular analyst Ali Martinez noted that as ETH approached $2,400 on October 28, on-chain transaction volume surged past $100 billion. At that moment, the price was rejected and retreated toward $2,300. He said whale activity may have affected Ethereum’s performance and cited Santiment data showing that large investors reduced their exposure by roughly 160,000 ETH, worth nearly $350 million, in just five days.

“This distribution could be contributing to the downward pressure on the price,” he stated. Martinez pointed to a second bearish factor: more coins stored on exchanges. He said the figure has risen by 100,000 units (worth around $240 million) and that it “puts more ETH within reach of sellers, potentially adding to downward pressure.

” Last but not least, the analyst claimed that Ethereum’s technical picture is weakening. He noted that the asset has lost the $2,385 support and appears to have broken out of a right-angled ascending broadening formation on the daily chart. “If selling pressure persists, the pattern points to a move to $2,000,” he concluded.

X user Ted also presented a rather pessimistic view. He said ETH failed to reclaim the $2,400 level and, as long as it stays below, “there’s a decent chance” of falling below $2,200. Some Bullish Factors Unlike the aforementioned whales that offloaded ETH, one large investor has made a huge bet that the asset’s price will rise.

X user Max Crypto revealed that the mysterious market participant opened a $45 million long position with 25x leverage after the market headed south. What’s particularly interesting is that the whale has made 20 trades so far and has a whopping 100% win rate. Some commenters think this isn’t a random investor but someone with inside information about events or developments that could trigger a price rally for ETH.

The asset’s Relative Strength Index (RSI) also flashes signs that a move back into green territory may be coming. The ratio has fallen to just above 30, meaning ETH is near oversold territory and could be gearing up for a short-term rebound. The index runs from 0 to 100, where anything above 70 signals a potential incoming pullback.

ETH RSI, Source: RSI Hunter