Ethereum has experienced a notable decline, sliding to the $2,400 range following a sharp selloff that brought prices closer to the 200-week moving average and a critical long-term trend channel. Currently, ETH is situated within a high-activity trading zone that may dictate its short-term trajectory.
On the daily chart, Ethereum extended its pullback, trading around $2,535 after a significant downward movement that resulted in approximately a 6% drop during a single session on the Bitstamp exchange. This retracement is viewed by some analysts as a continuation from the August 2025 peak near $5,000, which is considered the cycle”s latest higher high.
Crypto analyst Leo Lanza pointed out that despite the decline from the $5,000 mark, if Ethereum can maintain a higher low structure, it might still fit within an uptrend. His analysis highlights that Ethereum is nearing a long-term rising trend channel that originated in March 2020. However, he cautioned that the channel has only two significant touchpoints so far, indicating the need for further confirmation before it can be regarded as a dependable boundary.
The volume profile on the chart reveals trading concentration across various price levels. Lanza explained that low volume nodes often lead to rapid price rejections due to the historical lack of trades in those areas. Conversely, high volume nodes indicate acceptance zones where trading activity can stabilize price movements and encourage consolidation. Currently, Ethereum is within a high volume node, suggesting that market participants may regard this area as a critical decision point rather than a straightforward trading pocket.
If Ethereum were to drop into the identified low volume area, the price movements could accelerate in either direction due to diminished liquidity and reduced prior trading interest. For the time being, the chart indicates a market testing its support structure, with the outcome hinging on how Ethereum responds near the long-term trendline and the high volume trading band.
As Ethereum retraced towards the 200-week moving average, traders are closely monitoring for a potential bullish response. The recent weekly candle has shown a steep decline, pushing ETH down to this crucial moving average, a long-term trend indicator that typically attracts significant attention during pronounced pullbacks.
Market commentator StockTrader Max emphasized that this is the critical juncture where bulls “must show up.” He argued that a rebound from the 200-week moving average would substantially enhance the chart”s outlook. This perspective is grounded in the belief that long-term buyers often defend this average during market corrections.
The chart also illustrates Ethereum slipping below shorter-term trend indicators throughout the selloff, with the 50-week moving average situated above the current price, while the 200-week line is nearer to the trading level, creating a high-pressure zone that could either stabilize momentum or lead to further declines.
If Ethereum manages to hold above the 200-week average and subsequently reclaim nearby levels, it would signify a support test rather than a break in the trend. Conversely, if the price fails to recover and continues to close beneath the long-term average, it would indicate that sellers still dominate the market, suggesting a weakening of previous support levels.
