Macro FUD is ramping up, and the market is starting to get tested.
On the charts, holding key levels is crucial to keep FOMO alive, especially as geopolitical tensions are already sparking pockets of panic across global markets. Ethereum [ETH] clearly isn’t immune to this pressure.
Since mid-January, ETH has closed every weekly candle lower than the last, showing a clear bearish bias as bulls failed to defend key zones. Still, the debate continues: Has Ethereum bottomed, or is more pain ahead?
Source: TradingView (ETH/USDT)
Notably, on-chain data offers some insight.
Historically, Ethereum’s MVRV ratio dropping below 0.80 has often signaled a market bottom. Currently, it sits at 0.78, suggesting that ETH may be undervalued, a view further reinforced by its deeply oversold RSI.
Against this setup, Tom Lee’s Ethereum bottom thesis starts to make sense. He highlights six on-chain indicators that, historically, have lined up with price levels where bulls step in, often triggering significant rebounds.
Taken together, these signals suggest that a bottom could be forming for Ethereum, likely somewhere around the $1.8k-$2k range. The big question now is: Are bulls actually noticing these signals and stepping back in?
Ethereum staking cuts supply, but is the shock overstated?
For Ethereum to form a bottom, the order book needs to lean toward bids.
That said, there are some encouraging signs. Despite the risk-off mood, staked ETH just hit a record 37.1 million (about 31% of the total supply), showing that validators are keeping their coins locked up for the long haul.
On top of that, nearly 190,000 ETH moved off exchanges this week alone, pushing the total available Ethereum on exchanges down to a two-week low of 16 million. Taken together, it looks like a supply squeeze could be starting to take shape, which could give bulls some room to step in.
Source: CryptoQuant
However, it may still be too early to call a confirmed bottom.
From a statistical perspective, Ethereum selling has been substantial. Ethereum ETFs have offloaded 563,600 ETH over the past five weeks. On top of that, a single whale recently sold $47.77 million worth of ETH. That’s a significant amount of selling, well in excess of the current demand.
Against this backdrop, calling a bottom based on a supply squeeze feels premature. With weak technicals, persistent selling, and ongoing macro FUD, it’s hard to see ETH holding above $1.8k right now.
In this context, the bottom thesis reads like a classic “sell-the-news” setup.
Final Summary
- On-chain metrics and Tom Lee’s six indicators suggest Ethereum could be forming a bottom around $1.8k–$2k.
- Staking and withdrawals from exchanges hint at a supply squeeze, yet heavy outflows make a confirmed bottom unlikely.
