The value of Ethereum drops to $3,300, but the bull market is not over yet

Yesterday, the value of Ethereum dropped to 3,304 dollars, worsening the chart structure of the crypto and putting its investors on alert.

The concerning data from the US labor market and the strength of the DXY dollar index triggered the bull collapse on December 17, which then extended in the following days.

In any case, there are still clear signals highlighting the strength of the demand for ETH and the solidity of the macro trend.

Let’s see all the details below.

Value of Ethereum in crisis: macroeconomic data scare crypto investors

On December 17, the value of Ethereum fell below the key level of $4,000, initiating a heavy correction that extended in the following days

Yesterday, after the crypto had attempted a recovery in the wake of the Christmas rally, there was a further plunge down to 3,300 dollars that wiped out all previous gains.

ETH investors have suddenly become more risk-averse, frightened by the 4% drop in BTC and its implications on the altcoin market.

What seems to have triggered the collapse of the crypto sector are the concerning macroeconomic signals on the US labor market and the DXY dollar index.

In particular, there are doubts about the reliability of the US employment data, with the December 12 report from the FED that estimated a downward revision of 818,000 payrolls up to March in 25 states.

This has impacted Jerome Powell’s monetary policies, who has reduced the Central Bank’s expansive trajectory, negatively affecting not only the value of Ethereum and Bitcoin, but all Western speculative markets.

In all this, even the strength of the US dollar index, at its highest levels in the last two years, does not help to support the crypto assets from the selling pressure of the bull and bear speculators.

More closely, it emerges how the DXY index rose to 108.3 on December 26, compared to the value of 106 the previous month, anticipating a possible risk of recession.

Global economic concerns have also increased. According to Reuters, the prospect of new tariffs on U.S. trading partners threatens to exacerbate price pressures and weigh on long-term growth.

These conditions have led to the transfer of many investment capitals to cash and liquidity deposits, creating a bear effect on the prices of risk-on assets like Ethereum.

Analysis of derivative and on-chain data on ETH: the situation is still under control

Despite the value of Ethereum having dropped by about 20% from the December highs, the data from the derivatives markets suggest that the bull are holding their position firmly.

Between December 18 and 26, nearly 600 million dollars of long positions on ETH were liquidated, but demand continues to be present on the crypto.

Its monthly contracts are still being traded at an 11% premium over the spot market, slightly above the neutral range of 5% to 10%.

The funding rate is still in positive territory, highlighting a situation where the longs are paying the financing of the shorts.

The open interest also remains within a bull outlook, with the sum of derivative contracts still being double compared to the data from October.

In detail, according to Coinalyze, speculative positions on the value of Ethereum have remained at 15.35 billion dollars, up from 7.8 billion at the beginning of October.

Source: https://coinalyze.net/ethereum/open-interest/

At the same time, the on-chain data on Ethereum also maintain a bull momentum, supporting the cryptocurrency from the market’s turmoil.

The total value locked on the crypto network (TVL) has remained stable at around 20 million ETH in recent weeks, showing the resilience of the decentralized markets.

The majority of Ethereum DApps recorded increases in deposits, with Maker being a notable exception, down 12% during the period.

In recent days, many tokens of the ecosystem, such as Ethena and Morpho, have recorded significant increases, indicating investors’ interest in this type of products.

The crypto operators maintain a bull position on the value of Ethereum, aiming once again for the recovery of 4,000 dollars.

Now we await a new leg up of the TVL, which can strengthen the price structure and bring new demand to the crypto exchanges.

Source: https://defillama.com/chain/Ethereum?currency=ETH

Forecasts of Polymarket and Deribit on the value of Ethereum by March 28-31, 2025

The investors of Polymarket seem confident about a potential increase in the value of Ethereum by the end of the 1st quarter of 2025.

According to the data from the bet “what price will Ethereum reach by March 31?”, there are still quite a few bullish opinions in the market.

Although a further drop to the psychological threshold of 3,000 dollars is rated at 78%, the increase in quotations is also not ruled out by the betting options.

A rally up to 4,500 dollars by ETH is priced at 52% while reaching the all-time highs at 5,000 dollars has a 35% chance of success.

More ambitious targets like 6,000 dollars have a probability of 22%, then moving to 7,000 and 8,000 dollars with odds of 13% and 9%, respectively.

This scenario highlights a trend still typical of the bull market, where investors expect rising price values for the coming months.

Source: https://polymarket.com/event/what-price-will-ethereum-hit-by-march-31?tid=1735285736100

According to the investors of options of Deribit, the value of Ethereum is set to rise in the coming months.

For the expiration of March 28, 2025, there are large call bets from 3,800 dollars up to 6,000 dollars, highlighting the strength of the bull market.

The call contracts are 5 times greater than the put ones, with a total notional value of 1.6 billion dollars. The max pain price is set at 2,800 dollars.