ETH may have just gone through a leverage shake down as the cryptocurrency kicks off new weeks with a spike in sell pressure. Ethereum (ETH) price also briefly dipped below $2,000.
Ethereum Price Barriers Sustain
The $2,000 price level has been acting as a key support level in the latest Ethereum price’s bearish pullback. Many traders have been expecting the same price range to act as a bounce back zone after last week’s retest.
In fact, price briefly dipped below the same support level on 4 March. Nevertheless, many traders anticipated a bullish pivot and hence March brought forth a surge in appetite for leverage.
Ethereum open interest also demonstrated signs of a directional change in favor of the upside at around the same time as the latest uptick in appetite for leverage. This created the ideal set-up for a leverage. shakedown.
According to Coinglass, there was a surge in long liquidations in the last 24 hours, during which just over $90 million was liquidated. In contrast, only 12.14 million in long liquidations were observed the previous day.
The ratio of longs vs shorts liquidations was also noteworthy. Only $9.05 million worth of short liquidations were observed.
The latest wave of FUD and subsequent sell pressure has resulted not only in a retest of this key support level. This means the odds were overwhelmingly staked against the longs.
The leverage shake-down was occurred after an unexpected wave of sell pressure. This registered in the spot segment as a $133.20 million spike in spot outflows.
The wave of sell pressure pushed Ethereum price down by over 8% on Sunday. The cryptocurrency dipped as low as $1996.22 during the trading session but managed to bounce back to a $2,206 press time price tag.
Is ETH Set for a Bullish Recovery or will Bears Push Below $2000?
This latest retest of the $2000 support demonstrated a significant cool down in sell pressure. A potential reason for this could be the surge in large buys observed close to its recent lows.
A cluster of large buy positions fortified the support at the time of writing. However, it is worth noting that they were not as many, or large as one would expect in the event of major accumulation opportunity.
A dip in large sell positions near the $2000 was also observed, suggesting that whales are unwilling to continue selling below the current price zone. This suggests that ETH could potentially bounce back from the $2,000 support level.
On the other hand, a bearish start for the week could potentially set the mood at least for the first half of the week. In other words, the risk of Ethereum possibly dipping and extending its stay below $2,000 remains real.
In summary, the market is still fearful and sentiment remains weak. Will it break the $2,000 support level or the new week pave the way for a demand comeback?
 price tests key level ($2,000) but will it bounce back or will weak market sentiment pave the way for more downside?){kind=link}