Finance

Ethereum Plunges: Will ETH’s Slide to $1,700 Trigger a Crypto Market Crash?

Ethereum‘s price dropped 8%, nearing key supports and risking a fall to $1,700 amidst broader market correction.

byAndres Castro

November 5, 2025, 8:38 AM

Smartphone displaying a crypto trading chart showing Ethereum's price dropping.

A mobile screen shows the Ethereum price sinking amid a sell-off. By TY Lim / Shutterstock.com.

Executive Summary

Ethereum (ETH) experienced an 8% price drop, nearing critical support levels and risking a fall below $3,000, with analysts warning of potential further drops to $1,700.

The cryptocurrency sell-off is attributed to the Federal Reserve’s uncertainty regarding future interest rate cuts and new tariffs on China announced by President Donald Trump.

Technical analysis indicates ETH has broken a critical weekly support level, with a need to reclaim $4,000 for a positive reversal, while bearish projections warn of a potential decline to $2,400 or $1,700.

The Story So Far

The current cryptocurrency market correction, including Ethereum’s price drop, is largely attributed to macroeconomic pressures, specifically the Federal Reserve’s recent interest-rate cut announcement coupled with uncertainty about future reductions, which negatively impacts speculative assets. This situation is compounded by President Donald Trump’s mid-October announcement of new tariffs on China, prompting investors to shift from cryptocurrencies to safer havens.

Why This Matters

Ethereum’s recent price drop, fueled by macroeconomic uncertainty from the Federal Reserve’s interest rate outlook and new tariffs announced by President Donald Trump, signals potential further instability for the broader cryptocurrency market. Should ETH fail to reclaim critical technical support levels, a continued decline, possibly towards $1,700, could trigger a deeper correction across altcoins as investors seek safer assets.

Who Thinks What?

Ram Ahluwalia, Chief Investment Officer at Lumida Wealth, attributes the cryptocurrency sell-off to macroeconomic headwinds, specifically the Federal Reserve’s uncertainty about further interest rate cuts and President Donald Trump’s new tariffs on China, which prompt investors to seek safer assets.

Analysts at The Birb Nest emphasize technical indicators, stating that Ethereum has broken critical weekly support and must reclaim $4,000 on a weekly basis, along with the ETH/BTC yearly open of 0.0355, to avoid a further drop towards $2,800.

Expert Ali Martinez warns of a bearish scenario where Ethereum could plummet to $2,400 or even $1,700 if it fails to reclaim the $4,000 mark, potentially triggering a deeper correction across the broader altcoin market.

Ethereum (ETH) experienced an 8% price drop on Tuesday, surpassing Bitcoin’s (BTC) dip amid a broader cryptocurrency market correction. This decline has pushed ETH dangerously close to key support levels, jeopardizing the $3,000 mark and raising concerns about potential further losses, with some analysts warning of a possible fall to $1,700 if critical thresholds are not reclaimed.

Macroeconomic Headwinds Fuel Sell-Off

Ram Ahluwalia, Chief Investment Officer at Lumida Wealth, attributes the recent crypto sell-off to the Federal Reserve’s (Fed) October meeting. On October 29, the central bank announced its second interest-rate cut of the year. However, Fed Chair Jerome Powell’s subsequent press conference signaled uncertainty about further reductions in December.

Ahluwalia’s analysis suggests this uncertainty has been detrimental to Bitcoin and the wider crypto market, as lower interest rates typically provide a tailwind for speculative assets like cryptocurrencies. Concurrently, mid-October saw President Donald Trump announce new tariffs on China due to restrictions on rare earth exports, prompting investors to flee cryptocurrencies for safer havens such as gold.

Technical Levels Under Scrutiny

From a technical standpoint, analysts at The Birb Nest highlighted on social media platform X that Ethereum has broken below a critical weekly support level, signaling a significant deviation. A breach below the altcoin’s yearly open of $3,337 could lead to a drop towards $2,800.

For a positive reversal, these analysts believe ETH must reclaim and close above $4,000 on a weekly basis. The ETH/BTC pairing is also under pressure, trading below its yearly open at 0.0355, with reclaiming this level deemed essential for a rise towards 0.04.

Bearish Projections Emerge

Despite some hopeful outlooks, experts like Ali Martinez caution against excessive optimism. Martinez warns of a worst-case scenario where Ethereum fails to reclaim the $4,000 mark, potentially plummeting to $2,400 or even as low as $1,700.

A decline of this magnitude would represent an additional 45% drop for ETH from current levels, which could trigger a deeper correction across the broader altcoin market. As of this writing, ETH is trading at $3,100, remaining 32% below its all-time highs.