ETH Risks Further Downfall to $3.5K if This Support Cracks: Ethereum Price Analysis

Ethereum is currently attempting to stabilize after the recent sell-off that pushed prices below key ￰0￱ the bullish trend structure hasn’t been fully broken on higher timeframes, both price action and on-chain metrics are showing mixed signals that traders should closely ￰1￱ Analysis By Shayan The Daily Chart On the daily chart, ETH has lost the midline of its ascending channel, breaking below the dotted trendline that had supported the price since ￰2￱ asset is now testing the $4,000 key level, which aligns closely with the lower boundary of the channel and the 100-day moving average located around the $3,800 ￰3￱ RSI has also dipped near the oversold region but has rebounded slightly and is now hovering around 40, hinting at a possible local bottom if buyers step in with volume.

However, if the asset breaks below the $4,000 level, a deeper drop toward the $3.5K range could be expected, which would officially put the market in a downtrend ￰4￱ 4-Hour Chart On the 4-hour chart, ETH shows signs of a short-term rebound after reaching the purple demand zone around $3,850. The price bounced quite sharply from this zone and is now consolidating just below $4K. This move forms a potential short-term bottom, especially since RSI has exited oversold territory and is now trending ￰5￱ said, the structure remains bearish as long as ETH stays below $4,200 ￰6￱ buyers can reclaim that level, momentum could shift back in favor of a bullish move.

Otherwise, a drop toward the $3,500 area would be very probable in the coming ￰7￱ Analysis Exchange Supply Ratio On the on-chain data front, Ethereum’s Exchange Supply Ratio continues to trend downward, now sitting at its lowest point in years, near ￰8￱ shows that a declining portion of the total ETH supply is held on centralized exchanges, suggesting a strong long-term accumulation trend. Historically, this has been a bullish signal, as it means fewer tokens are readily available for selling. However, this accumulation trend contrasts with the recent price ￰9￱ fewer ETH are sitting on exchanges, the price still dropped sharply, possibly due to short-term leverage wipeouts or broader market ￰10￱ any case, this metric supports the idea that long-term holders remain confident, and unless we see a sudden reversal in exchange inflows, the macro bullish structure stays intact.