Ethereum Price Forecast: ETH Likely to Drop to $3700 Soon

Highlights:

• Ethereum is trending towards the $3709.2 support
• The broader market correction is driving ETH price action
• Uncertainty around US-China relations is likely to add to the selloff

Ethereum (ETH) is in the red today, reflecting the overall weakness across the cryptocurrency market. When going to press, Ethereum was trading at $3816.54, down by 1.64% in the day. However, Ethereum trading volumes have shot up in the day. They are up by 32.27% to stand at $49.03 billion. This points to a scenario where holders may be exiting their Ethereum positions. It also means that while the long-term fundamentals remain strong, the prevailing environment in the short term does not favor long positions in Ethereum. There are multiple factors driving this sentiment in Ethereum and the broader cryptocurrency market. 

Trade War Uncertainty Weighing Down On ETH

One of them is the fact that a wave of uncertainty surrounds the financial markets. This is in part due to the ongoing trade war between China and China, and more importantly, how it is communicated. The most significant risk of the trade war is that the President is communicating it on social media.

Any negative social media posts about the trade war from the US president can send markets tumbling. This was evident on October 10, when Trump’s Truth Social post about a possible 100% tariff on China sent markets tumbling.

Things were going pretty well for crypto yesterday until Trump spoke. The market started to reverse after his comments that the meeting with China’s Xi, which he had been touting for weeks, might not happen after all.

Politics aside, I think we have a tough three years ahead in… pic.twitter.com/ApEfOhFfpP

— RebelOfBabylon (@ISeekAlpha) October 22, 2025

Since there is no certainty as to when such posts may arise, the markets are on edge. This is especially challenging for cryptocurrencies, which are known for their high volatility. This explains why Ethereum and other cryptocurrencies are showing weakness since the October 10 crash. The markets are now watching for what will happen on November 1, when the tariffs are scheduled to take effect. Unless there is clear communication about this issue, cryptocurrencies like Ethereum may continue to show weakness in the short term.

Bitcoin’s Price Action Weighing Down On Ethereum

Ethereum’s price weakness is also exacerbated by Bitcoin’s price action and the surrounding news. One of the latest news stories surrounding Bitcoin is that a whale has taken a short position of over $200 million. This is likely creating fears that it could be a precursor to the October 10 selloff.

At that time, a whale took a multi-million-dollar short on Bitcoin before the price crashed. Since altcoins tend to do worse than Bitcoin in market selloffs, investors could be sitting on the sidelines. This is due to concerns that another wave of price corrections may be underway.

$BTC , Whale NO CHARTS He Writes THEM! Forgot about predicting K-lines, this big insider draws them! 10 hours ago the same enigmatic trader who nailed the last flash crash with a massive one sided buy at 108,700 added another 1,000 $BTC to his short position at $112,300 to… pic.twitter.com/QOM0kpjjzO

— Bill Tech (@Tech_baro0) October 22, 2025

Institutional Avenues for Ethereum Investment Could Trigger Rebound

However, even as Ethereum’s price action remains weak, some factors may negate any significant correction. One of them is the fact that institutional avenues for Ethereum adoption are on the rise. For instance, Grayscale recently enabled staking on its Ethereum Mini Trust. This is a big deal as it could trigger an influx of institutional capital seeking both value appreciation and yield.

At the same time, there is a growing speculation that the Federal Reserve could soon cut interest rates. This is likely to give risk-on assets a short-term boost. A reprieve in US-China relations, as many are speculating on Polymarkets, could add to the momentum. This may explain why, despite the cloud of uncertainty in the markets, Ethereum is not experiencing any significant correction.

Staking is officially on Wall Street! 🚀

Grayscale just launched the first US-listed spot crypto ETPs with staking for $ETH and $SOL.

Now, traditional investors can earn yield on Proof-of-Stake assets without managing nodes.

A huge step for mainstream crypto adoption!… pic.twitter.com/7ULrSm6uSq

— Conor Kenny (@conorfkenny) October 20, 2025

Technical Analysis – ETH Trending Towards Critical Support

Ethereum is in a multi-day downtrend and is currently approaching the $ 3,709.2 support level. If bears push Ethereum through this support level, then a short-term correction to prices as low as $ 3,500 could follow.

However, if bulls take control at the support, or before it’s hit, a rebound could follow. In such a case, a rally to the multi-day resistance at $4081.4 could follow. Among these scenarios, the odds are higher for a test of the $ 3,709.2 support before any rebound. That’s because there is not much bullish momentum across risk-on assets.