Ethereum may reach $4,000 but key levels could trigger a rebound

Ethereum (CRYPTO:ETH) is experiencing a decline despite positive developments such as the launch of Ethereum Spot ETFs in the United States. 

Over the last week, ETH has fallen by 6.62%, and some analysts suggest that a further drop may be on the horizon before a potential rally. 

Market analyst Carl Runefelt’s analysis points out that ETH is currently moving within a falling wedge pattern. 

This pattern often leads to a significant price increase following a period of decline. 

The critical support level for ETH appears to be around $2,200, a zone where substantial buying activity has been noted. 

According to Runefelt, if Ethereum can rebound from this support level, it could see an increase of up to 80%, potentially driving its price up to $4,000. 

He noted, “Once a breakout occurs, there’s a strong possibility Ethereum could rise back to $4K.” 

To confirm the strength of this support level, AMBCrypto conducted its own analysis using the IntoTheBlock "In and Out of Money Around Price" (IOMAP) tool, which tracks key buying and selling zones. 

The analysis showed that the $2,200 mark is indeed a crucial area for buyers, with around 1.59 million ETH held in profit at this level. 

If ETH’s price falls to this range, it could prompt significant buying activity. 

However, the data also indicates that a reversal could happen at a slightly higher level around $2,281, where another 2.17 million buyers hold approximately 1.01 million ETH. 

Additional data from Hyblock’s cumulative liquidation levels reveal a bearish market sentiment, with more short positions than long ones, suggesting further downside risk. 

If this trend continues, ETH could move closer to the $2,200 support zone. 

Traders may want to watch these levels carefully to assess the potential for a rebound and consider their strategies accordingly. 

At the time of reporting, the Ethereum (ETH) price was $2,380.74.