Ethereum is attempting to stabilize around the $2,000 level as the broader crypto market shows tentative signs of relief. After weeks of persistent pressure, price action has halted its decline, but sentiment remains fragile. The recent rebound has helped ease immediate downside momentum, but the technical structure still reflects a market recovering from significant damage rather than entering a confirmed uptrend.
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According to an analyst at CryptoQuant, Ethereum has suffered a severe liquidation sell-off in recent weeks, falling sharply from a local high near $3,300 to a low around $1,850. The intensity of this movement becomes particularly evident when analyzing Net Taker Volume (30-day moving average), a metric that measures aggressive market order activity. In February, this indicator plunged to its most negative level since last November, highlighting the dominance of aggressive sellers during the decline.
Such extremely negative numbers typically reflect panic-driven execution rather than orderly repositioning. When taker volume leans heavily toward the seller side, it often signals forced exits, halts, and cascading liquidations in derivatives markets. While Ethereum’s attempt to hold on to $2,000 suggests that immediate selling pressure may be easing, the underlying data confirms that the market recently absorbed one of its most intense downside attacks in months.
Net taker volume signals capitulation – but not confirmation
The dominance of towering red bars in Ethereum’s Net Taker Volume highlights how aggressively sellers have controlled order books during the recent decline. When takers’ sell orders consistently exceed takers’ buy orders by such a magnitude, it reflects urgency. This is not a passive distribution; it is the market players who launch offers aggressively, often under pressure. The combination of panic-induced exits, systematic short positioning, and forced long liquidations likely amplified the move from $3,300 to levels below $1,900.
Notably, the only significant group of green bars – representing aggressive buying – appeared in mid-January, coinciding with Ethereum’s local peak near $3,400. This brief resurgence in demand failed to sustain, after which sales momentum took control again. Structurally, this trend suggests that bullish liquidity was exhausted before a broader deleveraging cycle unfolded.
Extremely negative Net Taker Volume readings are often associated with phases of capitulation. Historically, such surges can mark exhaustion points, as aggressive sellers eventually burn out. However, capitulation alone does not confirm an overthrow. For structural change to materialize, the imbalance must normalize. A contraction in the red bars followed by sustained dominance of green would signal renewed conviction from aggressive buyers.
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Ethereum struggles to reclaim $2,000 as downtrend persists
Ethereum remains structurally weak despite brief attempts to stabilize near the $2,000 level. The chart shows a clear breakdown of the $3,400-$3,600 region earlier this year, followed by a sequence of lower highs and lower lows – a classic downtrend formation. The recent rebound has not changed this structure.
The price is currently trading below the 50, 100 and 200 day moving averages, all of which are falling. This alignment confirms the bearish dynamic in the short, medium and long term. Notably, the 50-day average accelerated downward, reflecting sustained selling pressure rather than a temporary liquidity vacuum.
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The sharp decline towards the $1,850 area was accompanied by a significant rise in volume, suggesting forced liquidations and aggressive distribution. Since then, volume has moderated during the consolidation, indicating that while the panic has subsided, buyer conviction remains limited.
Technically, $2,000 functions as a psychological pivot rather than confirmed support. A sustained move above the 50-day average would be necessary to signal improving momentum. Conversely, failure to maintain the current range could reopen downside risk to deeper pockets of liquidity.
Featured image from ChatGPT, chart from TradingView.com
