On January 31, Ethereum dropped sharply by 12%, trading at $2,407.90 and extending weekly losses to 18.47%. The move comes after repeated failed attempts to hold the $3,000 level, highlighting strong selling pressure in the market.
TradingView data shows ETH has decisively broken down from a descending channel that previously contained the price between $3,000 and $3,400 since late 2025.
Multiple recovery attempts near the channel’s upper boundary were rejected, confirming distribution dominance over accumulation. This sell-off dragged Ethereum closer to the $2,350-$2,400 levels, resulting in one of the weakest closes of the month.
The short-term trend remains in the hands of the sellers, and any attempts to rally towards the $2,600-$2,800 levels are expected to face stiff resistance unless the trading volumes increase. A further decline could lead to the $2,200 level, which corresponds to the previous areas of low trading activity.
Technical Indicators Point To Oversold Conditions
The momentum indicators remain bearish. The 14-day RSI is about 25, indicating strong selling. A possible bounce may occur if it’s oversold, but since the RSI is below the signal line, the bearish momentum continues.
Market analyst Leo Lanza said that Ethereum is still in a long-term uptrend that began in March 2020. He says that the current correction could form a higher low if the price remains above the main trend line.
Volume profile data indicates that ETH is currently in a high-volume area where traders typically form positions before making the next major move.
Ethereum Higher-Timeframe Structure Still Supports Long-Term Trend
In the bigger picture, Ethereum maintained its uptrend most of the time in 2023-2024, forming higher highs and higher lows. The recent peak in August 2025 at around $5,000 was a long-term higher high, and the current correction is in line with the Fibonacci retracement levels of 0.5 to 0.618.
These levels are common areas where buyers enter an uptrend, indicating that buyers are supporting the uptrend. As long as Ethereum remains above the rising trend line and the support zone of $2,350-$2,400, the current correction is just a normal higher low.
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