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Ethereum (ETH) plunged to nearly $3,050 on Tuesday, marking a sharp weekly decline of over 13% and triggering $1.3 billion in long liquidations across global exchanges. The sudden drop has left over $7 billion in short positions hovering near the $4,000 level, setting up a potential short squeeze if the broader crypto market sees a recovery.
Analysts say the correction wiped out over-leveraged longs and may have brought ETH closer to a key support zone between $3,000–$2,800, a historically strong price floor. According to CryptoQuant, ETH has cycled through all major market phases this year: decline, accumulation, markup, and distribution is now testing long-term structural supports.
Traders are eyeing the $3,000 zone as a potential bottom. Technical charts also reveal a hidden bullish divergence between ETH’s price and its RSI indicator, hinting at a possible rebound.
Market expert Daan Trades commented,
“$ETH has fully rejected from that previous cycle high and is now back in that $2.8K–$4.1K range. Good chance this chops around before another volatility spike.”
If bullish momentum builds, a wave of short liquidations could push ETH sharply higher, potentially reclaiming the $4,000 mark in the coming weeks.
Top 5 Cryptocurrencies by Market Value
| Rank | Cryptocurrency | Price (USD) | Market Cap (USD) | 24h Change |
| 1 | Bitcoin (BTC) | $67,420 | $1.33 Trillion | +1.2% |
| 2 | Ethereum (ETH) | $3,050 | $365 Billion | -3.8% |
| 3 | Tether (USDT) | $1.00 | $118 Billion | +0.1% |
| 4 | BNB (BNB) | $575 | $85 Billion | -0.5% |
| 5 | Solana (SOL) | $168 | $78 Billion | +2.6% |
While Ethereum’s short-term dip has rattled investors, the broader setup suggests potential for a sharp rebound if market sentiment improves. A strong reversal could ignite one of the largest short squeezes in the crypto market this quarter.
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