Ethereum Price Crash: Key Levels to Watch & What this Means For Altcoins?

Ethereum (ETH) experienced a sharp sell-off over the weekend and has dropped below the $3,000 psychological level. This collapse has triggered $613 million in liquidations in the past 30 hours. Let’s explore why the Ethereum price is crashing and what’s next for ETH and altcoins.

Why is Ethereum Price Crashing? 

Over the weekend, crypto markets experienced a massive sell-off, driven mostly by Bitcoin’s collapse to $91K. This sudden nosedive caused Ethereum price to crash 25% in the past 12 hours, creating a daily low of $2,125.

The crypto market correction began after Trump signed an order imposing 25% tariffs on imports from Mexico and Canada and a 10% duty on China. These changes will take effect on Tuesday.

Arthur Hayes, the co-founder of BitMEX commented on the current market conditions saying,

“The beatings shall continue until moral improves. The pain stops when a TradFi outfit is on the verge of bankruptcy. Then the Fed reluctantly joins team Trump and prints dat money. And then you better be ready to buy #crypto like you have never bought before.”

Key Levels to Watch for ETH Amid Crypto Market Crash

The falling wedge formation that Ethereum price formed has come undone amid the crypto market crash. ETH blew through the $3,000 psychological level and swept the September 6 low of $2,150. The weekend crash created a swing low of $2,080.What’s interesting is the ETH price is up 20% from this swing low and trades around $2,500 as of this writing.

As the price recovers, the immediate support level is $2,341. To the upside, the key resistance levels to watch include $2,657, $3,057, $3,132 ,$3,592, $3,975 and $4,069.

What’s Next for Altcoins?

With Bitcoin’s collapse to $91K and Ethereum dropping down to $2,150, can altcoins recover?

CryptoCapo, a popular analyst who forecasted a crash for ETH, posted to his Telegram hinting at the start of an alt season soon.

However, the chart shows a bounce from $2,800 to $3,000, which was breached during the last 24 hours as ETH created a swing low close to the $2,000 psychological level. Regardless, the idea of an alt season persists and is dependent on a bounce from Ethereum price.

Investors need to understand that most altcoins have now dropped more than 50% in the past few weeks. Popcat, Dogwifhat, and others have dropped 90% from their peak. Such corrections are often limited to bear markets.

Does this mean crypto markets are in a bear market? No. Not essentially. Bitcoin’s high time frame trend remains bullish and is likely to continue on an uptrend. As long as this remains intact, there is a good chance that altcoins bounce. Moreover, historical data shows that the post-halving years in February were bullish for altcoins, whihc is in line with what Capo is forecasting.

All in all the outlook for the crypto market remains grim due to the recent crash. However, Bitcoin remains strong and above key BTC levels are still intact. If there is a bounce in Bitcoin price, then Ethereum price forecast, that remains neutral could flip bullish.