Ethereum (ETH) suffers worst October in 8 years, analysts eye $1,850-$1,920 support

Analyst Alaoui Capital posits that the cryptocurrency is nearing what they term "a make-or-break zone," indicating a risk of falling beneath the $2,000 psychological threshold and subsequently entering the $1,850-$1,920 support range. The analyst further suggested, "If price sweeps into this zone and gets a strong rejection, we could see a relief bounce that catches the bears off guard." This viewpoint was supplemented by the X user, who observed, "Everyone is looking at the downside, but what if ETH pulls a reversal right when nobody expects it." Concurrently, Ted forecasted a relatively modest downturn, pointing out that ETH closed its latest weekly candle below $2,400, and a failure to regain $2,350 "soon" might propel the price down to $2,200.

Regarding market sentiment, a notable concern involves the decreasing appetite from institutional participants. Spot ETH Exchange Traded Funds have recently experienced outflows, with an additional $220 million leaving these funds in the previous week. This trend suggests that entities such as pension funds, hedge funds, and other conservative investors are consistently lessening their involvement with the asset, compelling issuers like BlackRock, Grayscale, and Fidelity to liquidate ETH holdings to satisfy redemption requests. Should this downward trend persist, it could complicate any potential recovery for the cryptocurrency.

Furthermore, Arthur Hayes, the co-founder of BitMEX, recently liquidated more than $15 million worth of ETH and reduced his holdings in several other altcoins, including Ethena (ENA) and Uniswap (UNI). This action is noteworthy given his earlier prediction this year that Ethereum might reach $10,000 by the close of 2026.

Other market projections vary; Joep Gerla opined that ETH may trade within the designated manipulation area, potentially experiencing further price erosion, before subsequently moving into the distribution zone and possibly surging as high as $3,600. In contrast, the X user Wealthmanaged asserted that ETH is currently testing the nadir of a specific flag pattern and anticipates a substantial rebound exceeding $3,000 from its current level.

The performance of the asset this month contrasts sharply with prior momentum; September saw the second-largest cryptocurrency achieve nearly a 9% increase, leading to general expectations that October would maintain this upward trajectory. However, this month, which historically tends to be quite bullish, has disappointingly seen ETH fall by approximately 13%. If the period concludes in negative territory, it would terminate the asset's winning streak, thereby precluding four consecutive months of gains. The average return for October for ETH is documented at +4.14%, yet the current month is positioned to become one of the few exceptions exhibiting negative performance.

These diverging outlooks from various market participants highlight the current period of uncertainty surrounding the asset's trajectory, particularly as institutional capital flows show signs of contraction.

Why it matters

This downturn challenges the recent positive momentum and raises questions about the asset's near-term stability around the $2K psychological level. Continued outflows from institutional vehicles could complicate any potential recovery in the DeFi ecosystem.