Ethereum Price Slides 5% to $1,900— What’s Behind the Drop, and Could It Be a Buy-the-Dip Moment?

The Ethereum network represents the second-biggest cryptocurrency but has witnessed a price decrease, making users question its market value. The market has pushed down ETH prices, which kicked off analyses regarding crypto blockchain value movement forecasts and underlying factors. This article investigates the significant reasons behind Ethereum’s market downturns and touches on what investors need to anticipate in the future.

Ethereum Price Drop: 3 Factors Causing Recent Downtrend

The crypto world continues to recognize Ethereum as its leading force because the platform provides smart contract capabilities and maintains a large blockchain ecosystem. The recent downward trend in Ethereum market value leaves investors with unclear perspectives. Ethereum faces depressing price trends for three reasons: affecting broader markets, network development initiatives, and shifting investor attitudes.

The cryptocurrency market’s negative tone and other factors are the foremost causes of Ethereum’s price correction. Some of these factors include massive long liquidations in the crypto sphere, Trump’s tariff tensions, and their impact on the risk-on market. Further, the negative (bearish)technical indicators notably contribute to the recent downtrend in ETH price.   The market has negatively affected Ethereum similarly to how it affects dominant coins, including Bitcoin (BTC).

1. Trump’s Tariff Tensions and Their Impact on the Risk-on Market

Under Donald Trump’s administration, the renewed US tariff wars have created a major macroeconomic force affecting ETH’s price. President Trump introduced a 25% tariff for all US car imports on March 26, 2025, and planned to enforce it on April 3. Market analysts worry that a new cryptocurrency sell-off could occur, decreasing prices.

The 25% automobile import tariff specifically affects significant trading partners, including Mexico, Canada, Japan, and Germany. President Trump has approved these trade measures to support the U.S. car sector, although global financial markets, especially volatile assets that include ETH, will likely face adverse effects immediately. Following Trump’s introduction of tariffs on Canada, Mexico, and China during early March, the ETH crypto price plummeted to $2,100 and showed some recovery afterward. According to The Kobeissi Letter, Mexican President Claudia Sheinbaum announced her government will provide an extensive reaction to the introduced tariffs beginning April 2. She said, ‘The policy of imposing matching trade regulations will go into effect.’’

2. Long Liquidations in the Crypto Sphere

The 24-hour market drop in Ether resulted in widespread forceful liquidations of long positions between traders with leveraged bets. ETH positions worth more than 97 million dollars suffered complete loss during the past day, and long positions led 91% of the liquidations, amounting to $88.7 million. 

Image 1- ETH total liquidation Chart, published on CoinGlass  on March 29, 2025

The rapid price decline activated massive selling pressure, which resulted in traders being forced to sell their positions upon price liquidation. Because of forced sales during liquidations, price falls became more severe. 

Image 2- Liquidation Heatmap published on CoinGlass on March 29, 2025

Total market liquidations throughout the crypto sphere exceeded $353 million shortly after the event that caused leverage instability.

3. Bearish Technical Indicators

The Ethereum price technical indicators are flashing some bearish sentiments in the market, bolstering the recent price drop. The ETH price exceeds its major moving averages at $2,293, which aligns with the 50-day MA, and $2,860, which coincides with the 200-day MA. The bearish sentiment intensifies as the short-term average has flipped below the long-term average, indicating a death cross pattern. 

Image 3- Provided by Emmaculate, published on TradingView, March 29, 2025.

Moreover, the Ethereum price struggles within the falling parallel channel, as the odds tilt towards the bears. The Relative Strength Index (RSI) is also southbound, currently at 37.52. These technical indicators further contribute to the Ethereum price’s downward trajectory. 

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