Ethereum’s price has been under intense bearish pressure over the past few weeks, reflecting the general volatility of the cryptocurrency market. The altcoin lost almost 20% of its value last week, freely falling below the psychological level of $3,000 since Thursday, January 29.
As the market continues to show signs of further downside risk, it is unknown how far Ethereum’s price will fall in the current bearish setup. However, the latest on-chain data provided insight into the next critical levels for the second-largest cryptocurrency.
Next ETH support is $2,475: Glassnode
In a recent post on Platform X, cryptocurrency analyst Ali Martinez identified the next three levels of on-chain support for the Ethereum price. This on-chain rating is based on the UTXO Realized Price Distribution (URPD) metric, which helps identify mighty resistance and support levels based on the investor’s cost base.
For context, an investor’s cost basis refers to the actual price at which they purchased a specific cryptocurrency (Ethereum in this scenario). Typically, the ability of a price level to function as a support or resistance zone in the chain depends on the number of traders who have a cost basis at that level.
As inferred earlier, the UTXO realized price distribution tracks the amount of a specific cryptocurrency that was purchased at a specific price level. Currently, price levels below the current spot value with significant trading activity are often considered major support zones, as shown in the chart below.
The reason for this expectation is that investors whose cost base is close to these price levels will likely double down on their positions and buy more coins. This increased buying activity will therefore provide a cushion for Ethereum’s price to hold steady and potentially rebound.
Highlighting data from Glassnode, Martinez identified the $2,623, $2,475 and $1,881 levels as the next key support zones for Ethereum price after losing the $2,772 level. However, the altcoin price also appears to have lost support at $2,623 and $2,475 after its recent decline over the weekend.
Etherum Price Overview
At the time of writing, ETH is trading at around $2,410, reflecting a decline of over 10% in the last 24 hours. After the recent decline, the altcoin’s price appears to be hovering around a support cushion at around $2,475.
If ETH continues below this support level, investors could see the Ethereum price drop to as low as $1,881. A decline of this magnitude would represent a decline of 25% from the current price point and a correction of more than 60% from the peak of the cycle.
Featured image from iStock, chart from TradingView
