What happened?
Ethereum dropped from above $4,700 to around $3,800 in about two weeks, a roughly 18% fall, and is now testing immediate support at $3,787–$3,800. Technical indicators show extreme fear and many sell signals, though the RSI and the lower Bollinger Band suggest the selloff may be getting oversold. A break below the 200‑day EMA near $3,535 could push ETH toward $3,700–$3,550, while a clean move above $4,040–$4,260 could open the door to $4,500–$4,800+.
Who does this affect?
Active traders and anyone using leverage are most exposed because a breakdown could trigger big liquidations and rapid price moves. Long‑term holders and institutions matter too, since exchange supply is at nine‑year lows and major wallets have added hundreds of millions, so their behavior can sway the market. The wider crypto market and altcoin projects could also feel the impact if Bitcoin dominance soaks up liquidity or sentiment stays stuck in extreme fear.
Why does this matter?
This matters because the next decisive move will shape short‑term liquidity and sentiment, either triggering cascade liquidations on a drop or fast buying on a rebound. Macro catalysts like a likely Fed rate cut and continued institutional accumulation could fuel a sharp recovery and lift other risk assets if they materialize. But if support fails and BTC dominance drains altcoin cash, expect higher volatility and potential downside toward the 200‑day EMA, which would force many traders and funds to rethink allocations and risk management.