Ethereum is under renewed selling pressure as its price breaks down amid a sharp unwinding of leveraged positions. After weeks of uncertainty, bearish momentum has strengthened significantly, pushing ETH below key support levels and signaling the possibility of further downside in the short term. As sellers regain control, the market is grappling with heightened volatility, weakening investor sentiment, and aggressive liquidations across major derivatives platforms.
The sudden erosion of support comes at a time when funding rates have turned negative and open interest is rapidly declining—clear signs that leverage is being flushed out of the system. This unwinding of overextended long positions has intensified downside pressure, allowing bears to dictate market direction. Analysts warn that if Ethereum fails to reclaim critical resistance zones soon, the next leg lower could be triggered by additional cascading liquidations.
Macro uncertainty is also feeding into ETH’s price action. Concerns around global liquidity, shifting central bank policies, and broader risk-off sentiment are weighing heavily on crypto markets. For Ethereum specifically, delays in network upgrades, declining transaction demand, and reduced on-chain activity are further amplifying bearish conditions. As traders retreat from risk and capital flows shift toward stable assets, Ethereum’s short-term outlook remains increasingly fragile.
However, not all analysts are pessimistic. Some argue that the current sell-off may ultimately set the stage for a stronger rebound once leverage resets and oversold conditions emerge. Historically, Ethereum has often recovered sharply following major liquidation events. Long-term fundamentals—such as institutional adoption, scaling advancements, Layer-2 ecosystem growth, and the steady rise of real-world asset tokenization—continue to provide a supportive backdrop for potential medium- to long-term recovery.
For now, traders are watching key technical levels closely. Failure to hold above near-term support could open the door to deeper corrections, while a decisive recovery above broken resistance would indicate that buyers are attempting to regain control. With leverage rapidly unwinding and sentiment turning cautious, Ethereum’s short-term price prediction leans bearish—but volatility remains high, and rapid trend reversals cannot be ruled out.
As ETH navigates this challenging phase, market participants should stay alert to derivatives metrics, liquidity zones, on-chain signals, and broader macro movements. The next few trading sessions will be crucial in determining whether the selling pressure intensifies or whether Ethereum begins forming a base for a potential recovery.
