Ethereum on the brink: What to expect at $2,900?

As Ethereum (ETH) is currently trading at $3.30K with a -1.69% pullback in 24 hours, the market remains at a critical crossroads. Investors are watching the key support level at $2,900, where the next significant move could be defined. With record trading volumes and an increasingly bullish institutional outlook, next week could bring substantial volatility.

Technical Pattern Developing: Confirmation or False Alarm?

Over the past few weeks, ETH has traced out a structure that many analysts interpret as a potential Head and Shoulders pattern. The move reaching $3,200–$3,250 in early December would represent the first shoulder, followed by a more aggressive rebound toward $3,400 (the head). The most recent bounce stopped at $3,100–$3,150, possibly forming the second shoulder.

The neckline, located between $2,900 and $2,950, marks the validation point. However, analysts warn to exercise caution: ETH has not yet decisively broken below this level. What we are seeing now is more of a sideways consolidation, where the price is continually testing this zone without confirming a definitive bearish reversal.

Technical Indicators Do Not Confirm Extreme Weakness

The Relative Strength Index (RSI) remains neutral, oscillating between 45 and 50. In classic Head and Shoulders reversals, the RSI typically approaches 60 on the right shoulder before dropping sharply. The absence of this pattern suggests that the current structure could simply be a phase of distribution or range, rather than a confirmation of reversal.

Many experienced traders view this bearish scenario skeptically. In stronger bull market cycles, similar patterns often fail, turning into congestion periods before the bullish trend resumes.

Key Levels to Watch

Immediate support: $2,900 – A decisive fall below this would generate additional pressure.

Critical risk zone: $2,750 – ETH has retraced approximately 61.8% of its last impulsive move, a level where reversals often occur.

If Ethereum cannot hold the $2,750 zone, a deeper liquidity sweep could be triggered before any sustained recovery.

Surge in Derivatives Volumes

The Ethereum futures market has hit all-time highs in 2025. For every dollar invested in ETH on the spot market, approximately $5 are circulating in futures contracts. Major trading platforms have reported record volumes in Ethereum derivatives, indicating that investors are using leverage heavily.

This reliance on derivatives has amplified ETH’s volatility. Although trading volumes are massive, the price has only reached marginal all-time highs, suggesting that recent movements have been driven more by liquidations than genuine buying in the spot market.

Bullish Outlook Remains Intact

Despite the short-term uncertainty, analysts maintain a constructive long-term stance. Tom Lee of Fundstrat projects ETH could reach $7,000–$9,000 in the coming months, driven by growing institutional interest in tokenizing real-world assets on the Ethereum chain.

Major financial institutions are already experimenting with on-chain solutions, pushing the value of real-world assets locked in Ethereum to over $20 billion. This adoption reinforces Ethereum’s position as the primary platform for decentralized settlements and security tokenization.

Expected Volatility in the Short Term

The upcoming market moves will be crucial. Investors should prepare for potential quick reversals, as Ethereum tends to break visible supports before making larger moves. With Bitcoin also approaching a turning point, ETH could briefly test recent lows before establishing its direction.

From a broader perspective, Ethereum has been stuck in a sideways correction since November 21. A decisive breakout above this corrective channel would be the first sign that the bullish momentum is returning.

For a more robust bullish scenario, ETH would need to sustainably recover $3,550. Until then, continued consolidation or further short-term decline remains a present risk.

Frequently Asked Questions

What is Ethereum’s forecast for 2026?
Depending on market cycles and institutional demand, ETH could trade in a range of $4,700 to $14,100 during 2026.

Could Ethereum surpass $15,000 by 2030?
Long-term models suggest yes, provided network improvements, institutional adoption, and ecosystem growth continue.

Is it safe to invest in Ethereum now?
The long-term outlook is supported by technological innovations and institutional adoption, but regulatory and market risks persist.

What are the main risks?
Regulatory uncertainty, macroeconomic volatility, concerns over centralization in staking, and shifts in crypto market sentiment.