Ethereum Price Faces Steep Decline, Breaking Long-Term Trend

Ethereum’s price has suffered a significant drop, making it one of the worst-performing major cryptocurrencies in February. The second-largest cryptocurrency by market capitalization fell to a low of $2,075, marking its lowest point since January 2024 and a sharp 50% decline from its peak in November 2023. This downturn represents a major break in Ethereum’s six-year upward trend, with February 2025 now marking its first negative month in February since 2018, and its worst performance for the month on record.

Ethereum’s Underperformance Compared to Competitors

Ethereum’s price drop has been steeper than that of its closest rivals. While Bitcoin has fallen by 25% from its 2025 high, Ripple has seen a 40% drop in the same period. Ethereum’s struggles are compounded by ongoing outflows from its exchange-traded funds (ETFs), with all spot Ethereum ETFs suffering asset losses for six consecutive days, bringing the total assets in these funds down to $2.86 billion. Similarly, Bitcoin ETFs have seen a loss of over $4 billion.

Furthermore, Ethereum is losing ground to rising competitors, particularly other Layer-1 and Layer-2 blockchain projects. Networks like Solana, BNB Smart Chain, and emerging Layer-2 solutions such as Base and Arbitrum are increasingly capturing market share, leading to more challenges for Ethereum’s dominance in the space.

The broader market sentiment has also added to Ethereum’s woes. The Fear & Greed Index has dropped to 33, indicating a strong risk-off environment that is hurting most cryptocurrencies.

Technical Breakdown and Bearish Indicators

Ethereum’s price decline is further supported by bearish technical indicators. As predicted in previous analyses, Ethereum has been following a bearish flag chart pattern. This pattern typically involves a sharp move in one direction, followed by a period of consolidation, which in this case took the form of a rising wedge—a well-known bearish continuation signal.

The most alarming technical development is the formation of a “death cross,” where the 200-day moving average crosses below the 50-day moving average. This pattern is considered one of the most bearish signals in the market, signaling that downward momentum could persist for an extended period.

Additionally, Ethereum has failed to maintain key support levels. The $2,150 mark, which was a critical support in August and September of 2023 and served as the neckline for the triple-top pattern at $4,000, has been broken. With the Average Directional Index (ADX) rising to 40, indicating that downward momentum is gaining strength, the bearish outlook for Ethereum is becoming more pronounced.

Potential Price Targets and Downside Risks

Given the technical breakdown, Ethereum’s price could see a further decline. Applying the distance between the triple-top pattern’s peak at $4,000 and the neckline at $2,150 (a 47% drop) suggests that Ethereum could potentially crash to as low as $1,095.

As Ethereum struggles with both external pressures from competitors and internal bearish technical patterns, the risk of further downside seems high. Traders and investors should remain cautious as Ethereum continues to face multiple headwinds, including the broader market sentiment and technical breakdowns.