Ethereum (ETH) Price Continues to Consolidate Under $2,000, Will Bulls Recapture This Psychological Level?

Ethereum's native token, Ether (ETH), continues to consolidate under $2,000, which some traders view as a psychological level.

Ether (ETH) price has slipped below $2,000, which some traders may view as a psychological level.

The altcoin slid below this range on March 10, and it continues to trade at its lowest value since October 2023 at the time of writing.

Moreover, Ether price has also seen some losses in its market value with respect to other major altcoins, with XRP price reaching its highest level against ETH in five years on March 15.

But the real question on investors’ minds is whether ETH is capable of recaprtering a portion of its recent losses or will traders begin to capitulate if the price falls below $1,900.

According to data from IntoTheBlock, a data analytics platform, Ethereum holders accumulated 3.56 million ETH between $1,900 and $1,843. This bulk of accumulation took place at an average price of $1,871.

As a result, the current accumulation value stands at $6.65 billion. This amount indicates that ETH’s price has a strong support level between $1,900 and $1,843, which can potentially act as the bullish reversal zone.

However, if Ether drops below $1,843, then the data indicates the possibility of rising capitulation fears.

Capitalization is a market sentiment where investors tend to panic, selling their positions at a loss during a sharp market correction.

If ETH consolidates for a prolonged period below $1,843, then the likelihood of a deeper correction increases exponentially.

Also, below $1,843, the size and volume of ETH accumulation are significantly lower, which further illustrates the importance of the $1,900 to $1,843 support range.

Similarly, the percentage of Ethereum addresses in profit dropped to its lowest level since the start of the decade. It is the lowest value since December 2022 at just under 46%.

A low percentage of profitable addresses has historically signaled a price bottom for Ethereum.

Given the high ETH accumulation and fewer addresses in profit, these factors may act as bullish signals. As a result, the likelihood of Ethereum consolidating below $1,843 in the long term decreases.

Hitesh Malviya, the founder of DYOR crypto, said it is not a “great time to bearish on ETH.” In an X post, Malviya highlighted the recent rise of real-world assets (RWAs) in the industry, with a 50.9% increase in growth over the past 30 days and an 850% yearly increase, with Ethereum and ZKsync capturing more than 80% of the total market share.

Alphractal, a crypto data analysis reviewed Ether’s current market sentiment based on the long/short ratio, a metric to evaluate the proportion of futures traders betting for price increases (long) vs decreases (shorts).

According to the chart above, the largest investors are more inclined to taking long positions, whereas smaller investors are in the process of de-leveraging. De-leveraging means unwinding risky, borrowed positions, which lowers market volatility and interest in leveraged trading.

With the current ratio at 1.3, the long/short ratio signals a balanced but cautious market.

“Despite a recent rally, smaller traders are quickly de-leveraging. Conversely, the whales are in no mood to give up their bullish positions just yet. This could indicate that smaller traders, who tend to be more sensitive to short-term price fluctuations, are taking profits or reducing their leveraged trades as the market approaches a potential resistance level. In contrast, larger investors, who typically have a longer-term perspective, are unfazed by the short-term price action and are maintaining their bullish bets.”