ETH Market Outlook: Why do analysts predict continued weakness in the coming weeks after short-term uncertainty is digested?

As of February 28, 2026, according to Gate Market data, Ethereum (ETH) is currently priced at $1,870 USD, with a 24-hour trading volume of $492 million. After experiencing a short-lived oversold rebound in late February, briefly surpassing the $2,100 mark, ETH has once again entered a phase of oscillation and decline. Although the price has managed to hold above the $1,800 psychological level, market sentiment has not reversed. Some analysts have recently expressed the view that, as short-term market uncertainties are gradually digested, Ethereum may face continued weakness in the coming weeks.

Background of the Weakness and Timeline

The recent shift in market sentiment is not without signs. Behind it lies months of price pressure and the amplification of key event sentiments.

Monthly Downtrend: Since late 2025, Ethereum has been in a prolonged downtrend. Entering 2026, the decline has intensified, with ETH experiencing six consecutive monthly declines. In February, the largest monthly drop approached 30%, marking a retracement of over 60% since the beginning of the year, making it one of the worst start-of-year performances in history.

“Transparent Selling Pressure” from Founders’ Addresses: During a fragile market in February, a series of transactions from addresses linked to Ethereum co-founder Vitalik Buterin sparked widespread discussion. On-chain data shows that this address executed hundreds of sell transactions in February, totaling approximately 19,326 ETH. Although Vitalik announced the sell plans in advance, emphasizing that the funds would support open-source projects and public goods, and the process was highly transparent, the fact that actual sales slightly exceeded the pre-announced amount amid falling prices has shaken market confidence. Some investors interpret this as a negative signal.

Data and Structural Analysis

Beyond market sentiment, on-chain data and macro structures present a complex picture of mixed bullish and bearish signals.

On-Chain Positive Signals: From a micro-structure perspective, there are some bright spots. When ETH broke below $1,900 recently, on-chain data showed signs of “smart money” bottoming out. First, whale addresses began accumulating heavily, with some withdrawing 20,000 ETH from exchanges into self-custody wallets, indicating long-term holding intentions. Second, the Coinbase premium index, which reflects institutional demand in the US, turned positive in late February for the first time since January, suggesting renewed buying pressure from US investors. Additionally, ETH reserves on exchanges have continued to decline, approaching multi-year lows, often seen as a sign of weakening sell pressure.

Macro Liquidity Constraints: However, micro signals are insufficient to counteract macro headwinds. In Q1 2026, the crypto market is experiencing a liquidity squeeze driven by multiple factors: unwinding of yen arbitrage positions, the rebuilding of the US Treasury’s TGA account draining market funds, and systemic increases in derivatives margin requirements. These factors form a “triple barrier” suppressing risk assets including ETH. In this context, ETH’s MVRV ratio has recovered from deep negative levels but remains in a mildly undervalued zone, indicating overall market confidence has not yet returned and new capital inflows are limited.

Market Sentiment Breakdown

Market analysts hold divergent views on ETH’s short-term trajectory, mainly divided into two camps.

Bearish and Cautious (Mainstream View): Swftx chief analyst Pav Hundal explicitly states that ETH may continue to weaken over the next few weeks, potentially testing the “most experienced investors” in the medium term. Many technical analysts agree. They believe that although ETH has temporarily held key support levels, selling pressure during rebounds indicates prevailing bearish sentiment. The likely range for the near term is between $1,750 and $2,111. If $1,750 support fails, the price could further decline to around $1,537 or lower. Some traders warn that a drop below $1,820 could signal the start of a new downtrend.

Bullish and Optimistic (Non-Mainstream View): Conversely, some analysts look for longer-term hope. Rekt Capital points out that ETH’s monthly chart is on a multi-year support trendline established since 2022. If the March close can hold above this trendline (around $1,960–$1,970), a rebound toward $2,250–$2,500 is possible. Additionally, some traders believe ETH is forming a double bottom on higher timeframes, and current prices are in a historic multi-year demand zone, often associated with accumulation rather than distribution.

Reality Check on Narratives

It’s important to distinguish facts from opinions and assess the authenticity of narratives.

Facts: Vitalik’s linked address sold 19,326 ETH in February; whale addresses increased holdings when prices fell below $2,000; exchange reserves of ETH are at multi-year lows.

Opinions: Equating Vitalik’s sales directly with “founders leading a dump” oversimplifies the situation, ignoring the transparency and prior announcement of fund use. Similarly, interpreting whale accumulation as a “bullish signal” is overly simplistic; it could be part of long-term positioning, hedging, or rebalancing rather than a clear trend reversal.

Inferences: Market participants often synthesize these facts to conclude “institutions are buying, retail is fleeing” or “insiders are pessimistic.” While these inferences have some logical basis, they lack decisive evidence and mainly reflect psychological projections amid current market fragility.

Industry Impact Analysis

Ethereum’s ongoing weakness has profound structural effects on the broader crypto ecosystem.

Firstly, as the foundational asset of DeFi and Layer 2 ecosystems, ETH’s price weakness drags down total value locked (TVL) across these sectors and dampens innovation and speculation. Secondly, key price levels are critical. The $2,000 mark is not only psychological but also a dense liquidation zone for leverage positions. The market’s response at this level will determine the balance of bullish and bearish forces: a sustained breakout could attract new buyers, while a quick breakdown might trigger cascading liquidations and deepen the decline.

Scenario Evolution and Outlook

Based on current information, three main future paths for ETH over the coming weeks can be envisioned:

1. Neutral Scenario (Higher Probability): Macro liquidity remains stable, with no significant deterioration or improvement. On-chain buying (e.g., whale accumulation) balances with overhead selling pressure (panic selling, early trapped longs) within the $1,900–$2,200 range. ETH oscillates within this zone, consolidating and waiting for macro or sector catalysts. This aligns with the “continued weakness” forecast by analysts.

2. Bearish Scenario (Moderate Probability): Further macro liquidity tightening (e.g., renewed yen rate hikes, US stock declines), or a sharp drop below $1,900 or even $1,750 support levels. Losing key monthly support could trigger technical sell-offs and leverage liquidations, pushing ETH toward the $1,500 demand zone.

3. Bullish Scenario (Lower Probability): If Vitalik’s long-term upgrade roadmap (“Strawmap”) gains unexpected market approval, combined with steady inflows into ETH spot ETFs, market expectations for ETH’s scalability could improve. In this case, ETH would need to break above $2,200 with volume to reverse the current downtrend and initiate a mid-term recovery.

Conclusion

In summary, Ethereum is currently caught in a fierce tug-of-war between micro-level signs of potential bottoming and macro-level liquidity constraints. On-chain whale accumulation and initial institutional demand offer some support at the bottom, but global liquidity withdrawal and fragile confidence limit the scope and strength of any rebound. Until macro turning points or disruptive narratives emerge within the Ethereum ecosystem, the prevailing analyst consensus that “the next few weeks will remain weak” is well-founded. For market participants, adopting cautious, range-bound strategies and patiently waiting for clear breakout signals may be the most rational approach at this stage.