Ethereum Price Jumps 10% After 2-Year Low, But Can ETH Sustain Recovery?

Ethereum staged a strong rebound to $1,550 after hitting a two-year low of $1,410, marking a 10% surge in just 24 hours. This recovery follows a brutal 27% drop within two days that rocked investor confidence and triggered widespread liquidations across decentralized finance (DeFi) platforms and exchanges. 

The recent crash saw Ethereum futures lose over $370 million in liquidations, according to Coinglass. Short-term holders bore the brunt of the decline, with Santiment reporting nearly $500 million in realized losses during Monday alone. 

One of the largest events was Sky’s liquidation of a whale holding 53,074 ETH—worth over $74 million. Lending protocols like Aave also experienced a wave of forced liquidations, with nearly $162 million wiped out, illustrating how quickly DeFi can become a risk amplifier during volatile conditions.

DeFi Risks and Whale Collateral Threaten Stability

DeFi remains a key vulnerability for Ethereum. A whale with 220,000 ETH in collateral recently added 10,000 ETH and 3.52 million DAI to adjust their liquidation level to $1,119. If Ethereum falls below this threshold, another wave of forced selling could hit, exerting additional downward pressure. 

Despite these challenges, ETH technical analysis shows a mixed outlook. Although sentiment remains cautious, indicators like futures premiums and options skews suggest the market hasn’t reached panic mode yet.

On-Chain Metrics Show Resilience, But Headwinds Remain

Ethereum’s fundamentals tell a more optimistic story. The total value locked (TVL) on the network reached 30.2 million ETH on April 6—a 22% monthly rise. This outpaced growth seen on Solana and BNB Chain, signaling strong network utility even as price struggles.

However, ETH is still down over 67% from its all-time high of $4,864 set in November 2021. Meanwhile, macroeconomic pressures—like inflation uncertainty and interest rate speculation—continue to weigh on sentiment. The recent delay of the Pectra upgrade to May 7 also stirred concern, despite successful testnet deployment last month.

ETH Price Outlook: Key Levels to Watch

Ethereum is going through a tough time right now in the market. The price is stuck below $1,620, which many traders see as an important level that needs to be broken to move higher. If it can’t break that level soon, there’s a risk the price could fall lower. There are safety zones called support levels at $1,505 and $1,420. These are the prices where buyers might step in and stop the fall. 

But if Ethereum drops below $1,420, that could open the door to a bigger drop, possibly down to $1,000—a price level that many traders are watching closely. On the positive side, if Ethereum does start to rise again, it will likely run into some resistance. The first challenge will be at $1,700, followed by $1,720 and then $1,820. These are levels where sellers might show up and slow down the price increase.