Why Ethereum Hasn’t Fallen Below $3000 and Is Unlikely To: Four Reasons

Ethereum’s profitability metrics have fallen to levels historically associated with local lows. Network fees have increased by 83% over the week, indicating strong on-chain demand.

Ethereum’s profitability metrics have fallen to levels historically associated with local lows. Network fees have increased by 83% over the week, indicating strong on-chain demand.

The asset’s supply on exchanges has reached a nine-year low, while around $3000 remains a strong support level.

The price of Ethereum (ETH) held at $3000 despite recent sell-offs. Buyers actively defended this threshold, and the price soon recovered above $3300. According to network data and technical indicators, a drop below this level is unlikely.

Investors Are Realizing Losse

On-chain data show that the Spent Output Profit Ratio (SOPR) for the asset fell to 0.96, indicating that traders are selling the asset at a loss.

This behavior suggests that the current price decline is driven by panic and loss realization amid fear.

The SOPR indicator compares the value of coins at the time of their last movement with their price at reuse. Values below 1 usually indicate market participant capitulation and often precede the formation of a bottom.

SOPR Indicator. Source: Glassnode

Previously, when the indicator fell to 0.86 after Ethereum dropped to $1500 in April, it coincided with a subsequent 91% rise to $2700 in just four weeks.

Many investors view the current decline to $3000 as a similar entry opportunity.

Network Activity Is Increasing

Network metrics over the past seven days appear positive. Ethereum continues to dominate among blockchains, accounting for about 56% of the total value locked (TVL) in DeFi protocols, according to DefiLlama.

According to Nansen, Ethereum’s fee revenue over the past week reached $9.23 million. By comparison, Solana (SOL) fees increased by only 9.1%, while BNB Chain fees fell 41%.

Top Blockchains by Fee Size Over the Past Seven Days. Source: Nansen

The difference highlights Ethereum’s sustained dominance in trading volumes on decentralized exchanges, which, according to DefiLlama, rose 22% in October.

Minimal Ethereum Supply on Exchanges

The amount of the altcoin on centralized platforms continues to decline. According to Glassnode, Ethereum balances on exchanges decreased by 22% — from 17 million coins on August 24 to 13.14 million, a nine-year low.

Over the past seven days, deposit volumes to trading platforms fell by 31%, coinciding with a 14% price drop over the same period.

Analysts note that the declining coin balances on exchanges indicate that available supply for sale is shrinking, creating conditions for price support.

Ethereum Exchange Volumes. Source: Glassnode

Support Levels

According to TradingView, bulls continue to defend the $3000–3150 range. The 100-week and 50-week moving averages (SMA) pass through this zone, supporting the price since July.

If the asset remains above this zone, the market could return to growth. A break below $3000, on the other hand, may trigger a new wave of decline. The nearest support level is $2800, and if the drop continues, bulls are likely to defend the 200-week SMA near $2500.

ETH/USD Weekly Chart. Source: TradingView

Analyst Skew noted that buyers need to show activity in the $3200–3400 range. A drop below these levels, he said, would be an obvious cancellation of the Ethereum bullish scenario.

Another analyst, Crypto Patel, believes that holding support at $3000 could trigger a new wave of bullish trend.

Overall market sentiment for Ethereum has become noticeably more positive. The rise of optimistic social media comments is seen by analysts as an additional signal of potential price recovery.

Editor: Godfrid Brower

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