The Ethereum price has been under intense bearish pressure in recent weeks, reflecting the overall fragile state of the cryptocurrency market. The altcoin lost almost 20% of its value over the past week and has been in freefall below the psychological level of $3,000 since Thursday, January 29.
With the market still showing signs of further downside risk, there is no telling how deeply the Ethereum price will fall in the current bearish setup. However, the latest on-chain data has provided insight into the next critical levels for the second-largest cryptocurrency.
ETH’s next support is at $2,475: Glassnode
In a recent post on the X platform, crypto analyst Ali Martinez said identified the next three on-chain support levels for the Ethereum price. This on-chain evaluation revolves around the UTXO Realized Price Distribution (URPD) metric, which helps identify strong resistance and support levels based on investors’ cost basis.
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For context, an investor’s cost basis refers to the actual price at which they purchased a particular 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 investors who have their cost base at a given level.
As previously concluded, the UTXO Realized Price Distribution tracks the amount of a particular cryptocurrency acquired at a specific price level. Now, the price levels below the current spot value with significant trading activity are often considered key support zones, as shown in the chart below.
The reasoning behind this expectation is that with their cost base around these price levels, investors will likely double down on their positions and buy more coins. This increased buying activity will therefore provide a cushion for the Ethereum price to stay afloat and potentially bounce back.
Highlighting data from Glassnode, Martinez identified the $2,623, $2,475, and $1,881 levels as the next crucial support zones for Ethereum price after losing the $2,772 mark. However, it appears that the altcoin’s price has also lost the support at USD 2,623 and USD 2,475 after the latest decline over the weekend.
Ethereum price overview
At the time of writing, ETH’s price is around $2,410, reflecting a drop of more than 10% in the last 24 hours. With this latest drop, the altcoin’s price appears to be hovering around the support cushion at around $2,475.
If ETH levels remain below this support level, investors could see the price of Ethereum drop to $1,881. A decline of this magnitude would represent a 25% drop from the current price point and a correction of more than 60% from the cycle high.
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Featured image from iStock, chart from TradingView