Quick overview

Live ETH/USD Chart

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Ethereum (ETH) experienced a brief drop to $3,700, which caused traders to panic. Since then, the top altcoin has made a slight recovery before settling at just under $3,900. The overall sentiment remains cautious, but this widespread anxiety could spur a recovery.

Ethereum may still face challenges on its path to recovery. For example, CryptoQuant’s liquidation data shows that since leveraged long positions continue to dominate the market, the correction may deepen. Recent increases in long liquidations, often caused by sharp price declines, indicate that traders are being pushed out of overly long positions.

These long-driven liquidations have kept prices weak, with no significant recovery in sight—unlike short squeezes, which typically lead to quick rebounds. If this pattern and declining open interest continue, Ethereum could test levels below $3,400.

Ethereum has seen considerable fluctuations over the past month, starting around $4,170 in early October and briefly dropping below $3,800 by month’s end. After selling pressure increased mid-month, the overall trend continued downward despite several brief recoveries. Many traders have opened short positions against ETH following this week’s recent decline. Crypto analytics firm Santiment states that, based on past examples, this type of pessimism often leads to a recovery.

According to cryptocurrency analyst Galaxy, Ethereum is approaching the end of a long, 1,400-day consolidation phase, known as a ‘triangle.’ Since 2021, ETH has been trading within long-term support and resistance levels. If the cryptocurrency manages to break out of this pattern, November could mark the end of this retest and the start of a new bull run.