1. Technical Analysis: The key support level of $2100
Importance of the support level: $2100 is a significant support level for Ethereum, as it is the low point from June 2025 and also the low point from November 2025, having been tested multiple times without breaking. If Ethereum falls below $2100, it will break this important support level, triggering panic in the market.
Impact of technical patterns: The daily chart of Ethereum shows consecutive large bearish candles, with an entity strength exceeding 2%, forming a waterfall-like breakdown pattern. The 21-week EMA has fallen below the 50-week EMA, forming a death cross technical pattern. If it breaks below $2100, it may further drop to $2000 or even lower.
Technical Indicator Signals: RSI is close to 30, indicating an oversold signal; the MACD indicator, after turning negative, has not yet fallen below the levels of mid to late November last year, indicating that there may still be room for adjustment in the short term. If it falls below $2100, the RSI may further decline, and the MACD may further deteriorate, accelerating market panic.
II. Market Sentiment Analysis: The Amplifying Effect of Panic Sentiment
Fear and Greed Index: The cryptocurrency Fear and Greed Index is at 29, in the 'Fear' range (25-49), indicating that market panic sentiment remains high. If Ethereum falls below $2100, the Fear and Greed Index may further decline, potentially amplifying market panic sentiment.
Impact of Liquidation Amount: The total market value of cryptocurrencies has evaporated by approximately $111 billion in the past 24 hours, with the total liquidation amount reaching $2.2 billion. If Ethereum falls below $2100, it may trigger more liquidations, further amplifying market panic.
Changes in Investor Psychology: Investors often experience panic when facing market declines, eager to sell assets to avoid further losses. If Ethereum falls below $2100, it may trigger panic selling among investors, accelerating the market decline.
III. News Analysis: The Cumulative Effect of Negative News
Impact of Federal Reserve Policy: The market expects the Federal Reserve's meeting minutes to maintain interest rates unchanged, but the wording may lean hawkish, reinforcing expectations of 'long-term high interest rates,' which is negative for risk assets. If Ethereum falls below $2100, it may further strengthen market concerns about Federal Reserve policy, accelerating the market decline.
Impact of U.S. Non-Farm Data: The market expects that the U.S. non-farm employment data for January will be better than expected, which may further reinforce the Federal Reserve's hawkish stance, negatively impacting risk assets. If Ethereum falls below $2100, it may further strengthen market concerns about U.S. non-farm data, accelerating the market decline.
Impact of Other Negative News: If other negative news occurs, such as tightened regulatory policies, hacking attacks, or project failures, it may further amplify market panic sentiment, accelerating the market decline.
IV. Market Capital Analysis: The Accelerating Effect of Capital Outflows
ETF Capital Outflows: Ethereum ETF saw a net capital outflow of $8.96 million over the past 7 days, but a total net inflow of $66 million in January, indicating that institutional long-term allocation willingness remains unchanged. If Ethereum falls below $2100, it may trigger further ETF capital outflows, accelerating the market decline.
Exchange Capital Outflows: The ETH balance on exchanges has fallen to its lowest level since November 2024, indicating that chips are concentrating from retail investors to institutions. If Ethereum falls below $2100, it may trigger further outflows of exchange capital, accelerating the market decline.
Leveraged Capital Outflows: The current market volatility has reached 85%, with a high risk of liquidation for leverage above 5 times. If Ethereum falls below $2100, it may trigger further outflows of leveraged capital, accelerating the market decline.
V. Conclusion: If Ethereum falls below $2100, the likelihood of it accelerating to break below $2000 is high.
Technical Pressure: $2100 is an important support level for Ethereum. If this level is broken, it may trigger further deterioration in technical aspects, accelerating the market decline.
Amplification of Market Sentiment: Market panic sentiment remains high. If Ethereum falls below $2100, it may further amplify market panic sentiment, triggering panic selling among investors.
Cumulative News Effect: The cumulative effect of negative news may further strengthen the market's pessimistic expectations, accelerating the market decline.
Accelerating Capital Outflows: The accelerating effect of capital outflows may further exacerbate the downward trend in the market.
Therefore, if Ethereum falls below $2100, the likelihood of it accelerating to break below $2000 is high. Investors need to carefully assess risks, reasonably allocate assets, set strict stop-loss orders, and avoid high-leverage operations. If market sentiment remains low, it may further push Ethereum prices down; if market sentiment improves, it may drive Ethereum prices up.
It is important to note that the risks in the cryptocurrency market are extremely high. The above analysis is for reference only, and investors should make cautious decisions.
