Ethereum (ETH) Faces Pressure as Price Drops Below $1,800, Large Leveraged Positions at Risk of Liquidation
Ethereum (ETH) has dropped approximately 3% in the last 24 hours, slipping below the $1,800 level and placing significant pressure on large leveraged positions, including two massive whale vaults on Maker. These vaults collectively hold over $235 million worth of ETH, putting them at risk of liquidation as ETH’s price continues its downward trend.
Whale Vaults on Maker at Risk of Liquidation
The recent price decline has put Ethereum’s whale positions on Maker, a decentralized lending platform, in a precarious situation. According to on-chain data, two major whale vaults, holding a total of 125,603 ETH, are nearing critical liquidation thresholds. These vaults are at risk of being forced to sell their ETH holdings if the price continues to fall.
In Maker’s system, ETH is used as collateral for borrowing the DAI stablecoin. To avoid liquidation, the collateral must maintain a certain health ratio. However, these whale vaults have seen their collateral health ratios drop to dangerously low levels. One vault is facing liquidation if ETH hits $1,805, while the other is at risk if ETH falls to $1,787.
Technical Indicators Signal Further Decline
Ethereum’s price decline is supported by several bearish indicators. The Relative Strength Index (RSI), which measures whether an asset is overbought or oversold, currently sits at 24.37. This level indicates that ETH is in oversold territory, but it also shows that bearish momentum remains strong. Although an oversold condition could suggest a potential short-term bounce, history shows that RSI can stay in oversold territory for extended periods during strong downtrends.
Additionally, Ethereum’s Directional Movement Index (DMI) has shifted strongly into bearish territory. The Average Directional Index (ADX), which measures the strength of a trend, surged to 38.6, indicating that the downward trend is gaining momentum. Meanwhile, the -DI (negative directional indicator) has spiked to 40.23, showing that sellers are firmly in control of the market.
Key Price Levels to Watch
If Ethereum’s downtrend persists, the next critical support level to watch is $1,823. A break below this level could trigger further declines, with the next major support at $1,759. This would likely activate the liquidation of the two whale vaults on Maker, creating additional selling pressure that could intensify the downward move.
In this scenario, Ethereum could experience a sharp drop, with the next potential support levels at $1,700 and $1,650. These levels will be crucial for determining whether ETH can find stability or continue its bearish trajectory.
Potential for Reversal
While bearish sentiment currently dominates, there is still a chance for a trend reversal if Ethereum manages to regain some upward momentum. A shift in market sentiment could see ETH test the resistance level at $1,938. Breaking above this resistance could open the door to further price gains, potentially reaching $2,104 and beyond. If buying momentum strengthens, ETH could continue to rise toward $2,320 or even $2,546.
Conclusion
Ethereum faces a critical moment, with two major whale vaults on Maker at risk of liquidation if the price continues to drop. Technical indicators show strong bearish momentum, and if ETH breaks below key support levels, further declines could follow. However, if the trend reverses, Ethereum could regain ground and push toward higher resistance levels. Traders should closely monitor Ethereum’s price action over the coming days, as these levels could dictate its near-term direction.
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