Ethereum Price Prediction: ETH Direction Unclear as Bulls Falter at $3191.2 Resistance

Highlights:

• Ethereum bulls are losing momentum as the price approaches $3191.2 inter-day resistance
• Lack of momentum could trigger a wave of selloffs in the day
• Weakness in Bitcoin’s price action could accelerate such a short-term selloff

Bitcoin’s intra-day crash has triggered a domino effect, forcing traders with leveraged long positions to exit at a loss. Data from CoinGlass paints a brutal picture, with nearly $1 billion in liquidations in the past 24 hours alone.

Ethereum is among the top cryptocurrencies that have edged lower as leveraged longs are being liquidated. At the time of going to press, Ethereum was down by 1.92% to trade at $3137.44. Ethereum trading volumes were also in decline intra-day, an indicator that a lot of investors are sitting on the sidelines.

Over-Leveraged Bull Positions Feeding Short Sellers

One of the key factors driving Ethereum’s downside pressure is the liquidation of highly leveraged positions. In just a day, the crypto market saw a staggering $904 million in liquidations. A total of $811 million of that came from long positions, as traders expecting a rally got caught off guard.

Unsurprisingly, Bitcoin led the pack, accounting for $261 million in liquidated positions. Ethereum followed with $113 million, and Solana took third place with $39 million in forced exits.

Ethereum and Broader Market Yet to Excite New Investors

Besides the liquidation of leveraged positions, data indicates that there is a general lack of excitement in the cryptocurrency market at the moment. Glassnode data indicates that overall leverage across exchanges wasn’t as extreme as during the late 2023 rally. This indicates that the market isn’t quite in full-blown speculative mania yet.

Analyst Predicts Ethereum Price Could Drop Before New Highs

Some analysts expect the correction Ethereum has experienced in the last 24 hours to continue, at least in the very short term. Crypto analyst Benjamin Cowen sees a possible connection between interest rate hikes by the Bank of Japan (BOJ) and Ethereum price dips. He notes that previous BOJ rate increases in March and July of 2024 were followed by ETH corrections in April and August. Now, with another rate hike in January, Cowen speculates ETH might be due for one last drop before hitting new all-time highs.

Ray of Hope – Ethereum Active Addresses on the Rise

On the bright side, Ethereum’s network activity is climbing. The number of active addresses has surged by 37% since November’s lows, now reaching 575,000. Daily transactions are up as well, signaling continued interest in the network. Big players are also taking notice of Ethereum. World Liberty Financial recently bought $47 million in ETH, reinforcing confidence in Ethereum’s long-term prospects.

#Ethereum is on the verge of something big, and the excitement is palpable!

Buckle up, because this could be a turning point! pic.twitter.com/z3Sd18jXcv

— Crypto Admiral (@Crypto_admiral1) January 28, 2025

Technical Analysis – Ethereum Price Losing Momentum Below Inter-Day Support Level

From the charts, Ethereum is showing weakness below the $3191.2 support level. This weakness is evident in the fact that bulls failed to achieve it in yesterday’s price rebound, January 28. This shows that bearish pressure is still strong for Ethereum. If bears take full control and push Ethereum lower, then a correction to $3033.9 could follow.

On the other hand, if there is a surge in bullish sentiment and the $3191.2 resistance gives way, then a rally to $3300 could follow in the short term. Whichever of these two scenarios plays out depends on Bitcoin’s price action intra-day. If Bitcoin regains strong bullish momentum, then Ethereum could rally through resistance. The reverse could hold if there is an accelerated Bitcoin selloff in the day.

Recap

Ethereum is in the red as highly leveraged positions continue to get liquidated. However, Ethereum’s strong fundamentals suggest it could be poised for a rebound. The rising number of active addresses points to underlying strength despite short-term correction.