Five Major Reasons for Ethereum $ETH 's Significant Drop and Lack of Rebound:

1. Market Sentiment Panic and Insufficient Liquidity

The cryptocurrency market heavily relies on investor confidence. If Ethereum's price continues to fall, it may trigger panic selling, especially after the liquidation of leveraged traders, further exacerbating the decline. Just look at how many people were affected by the liquidation posts in $ETH ; when market liquidity seems to be drained, even selling at a loss finds no buyers. When buyers decrease and selling pressure increases, the momentum for rebound is naturally insufficient.

2. Macroeconomic Pressure

March 2025 coincides with a period of potentially heightened global economic uncertainty. The Federal Reserve's interest rate decision (usually announced in mid-March) will directly influence the future direction of cryptocurrencies. If the market expects interest rate hikes or the continuation of tightening policies, more investors will withdraw from high-risk assets like cryptocurrencies, leading to further weakening of Ethereum's rebound. Additionally, if the US dollar index continues to strengthen, it will also suppress the inflow of funds into the cryptocurrency market.

3. Technical Support Broken

From a technical analysis perspective, Ethereum has broken through a key support level (2000 USD), forming a bearish signal, which may indicate that the market is entering a downtrend. Bottom formation takes time, and without sufficient buying support, a rebound is difficult to achieve in the short term.

4. Weak Fundamentals

The fundamentals of $ETH do not exhibit sufficient attractiveness. Although Ethereum has risen in the past due to favorable factors such as Layer 2 scaling and network upgrades (like Shapella), if there are no similar catalytic phenomena in 2025 (such as DeFi or NFT booms), investor confidence will further decline, leading funds to flow towards other competing chains or assets.

5. Short-term Oversold but Bottoming Not Completed

Despite the significant drop, the market may still be in a "washing out" phase. Although it may currently be oversold, a rebound requires more time and accumulation of trading volume. If the bottom has not yet been solidified, the rebound momentum will appear weak.