Ethereum Price Forecast: Short-term Losses Amidst Increased Staking Activity

Ethereum’s price currently sits at $1,820 following $400 million in losses from short-term holders after President Trump’s tariff announcement. Although short-term sentiment appears bearish, recent staking activity suggests investor confidence remains. Key support at $1,800 is crucial; a decline below this level could signal further downside risks for ETH, possibly targeting $1,500.

The current price of Ethereum (ETH) stands at $1,820, following a significant $400 million in losses realised by short-term holders (STHs) due to heightened cautious sentiment related to President Trump’s tariff announcement. Despite this capitulation, the prevailing trend in ETH exchange and staking flows suggests that many investors maintain a bullish outlook, though further declines may occur if prices fall below $1,800.

On Monday, Ethereum bounced off the $1,800 support level amidst selling pressure from short-term holders and market anxiety over the reciprocal tariffs scheduled to be imposed on April 2. Although caution prevails in the near term, diminishing ETH exchange reserves and increasing staking balances may provide some price stability.

In March, short-term holders displayed an intensified risk-averse sentiment as they distributed their holdings, leading to spikes in the Dormant Circulation metric. Over recent hours, this selling resulted in significant losses, amounting to nearly $400 million on that Monday alone, indicating capitulation from these investors who primarily sold coins moved in the last six months. Historical trends suggest that after such selling, prices often stabilise.

Additionally, those holding between 1K – 10K ETH reduced their balances by 160K ETH in recent weeks, while larger investors (whales holding between 10K – 100K ETH) increased their holdings by 290K ETH. This divergence indicates differing sentiments across investor classes, influenced by recent performance that has seen lower ETH prices.

Ethereum exchange reserves have decreased substantially, with a withdrawal of 940K ETH this month. A significant portion of these funds likely transitioned to staking protocols, evidenced by an increase of around 530K ETH staked over the past three weeks, reflecting a strategy oriented towards long-term holding despite prevailing price decreases.

In terms of price projections, Ethereum will encounter a bearish continuation if the $1,800 support fails. Following a 10% decline over the weekend, Ethereum experienced $63.18 million in futures liquidations within a day. While support remains at $1,800, and buying pressure holds that level, the potential exists for upward movement if it breaks through the $2,070 resistance confirmed by a succession of resistance levels and moving averages.

Should ETH firmly decline below $1,800, it may reassess support at $1,500. Technical indicators such as the Relative Strength Index (RSI) currently identify weaker momentum, with bearish signals from the Moving Average Convergence Divergence (MACD) suggesting that downward momentum could accelerate under continued selling pressure.

Ethereum is a decentralised platform supporting smart contracts and decentralised applications (dApps). Its main currency, Ether (ETH), ranks as the second largest cryptocurrency by market capitalisation. The recent shift from Proof-of-Work (PoW) to Proof-of-Stake (PoS) occurred on September 15, 2022, as part of enhancing Ethereum’s scalability, security, and sustainability.

Gas fees on the Ethereum network are measured by gas units, influencing transaction costs. During high congestion periods, transaction fees can inflate, affecting investor behaviour and market dynamics. Investors are advised to conduct thorough research prior to making decisions, as market conditions remain volatile and risky.