Ethereum (ETH) risks dumping another 40% if this key level is lost

Ethereum is trading near $2,900 after breaking the bear flag pattern, with analysts warning of a possible drop to $1,666.

Breakdown pattern increases risk

Analyst Trader Tardigrade shared a three-day chart showing a bear flag on Ethereum. This pattern is characterized by a sharp decline and is usually followed by a further decline. The asset is now breaking below the flag’s lower support.

The post notes that Ethereum will need to close above $2,906 soon to avoid a bigger drop. “It has 1 day and 19 hours to recover more than $2,906 to avoid this outage.the analyst wrote. If the breakdown holds, the target is around $1,666 based on the prior move.

$ETH/3 days#Ethereum breaks down a bear flag, aiming for $1,666 🤯
⏰ It has 1 day and 19 hours to recover above $2,906 to avoid this outage. pic.twitter.com/1Q5XZjg1qP

— Trader Tardigrade (@TATrader_Alan) January 26, 2026

Another analyst, Ted, posted that Ethereum is trading flat near $2,900 after a sharp sell-off earlier. Open interest rises and reaches 5.255 million, indicating that more positions are being opened despite the sideways price.

Funding remains slightly positive at 0.0011, but has fallen, showing that interest is cooling. “Old swords were liquidated, and now new ones have arrived,The post added. The rise in open interest while the price remains stable could mean traders are preparing for the next move.

ETH/BTC pair in Key Area

Michaël van de Poppe, founder of MNF Fund, shared a chart of ETH against Bitcoin. ETH/BTC has a support level that was important before. The price is in a higher time zone, although it is now below the 21-day moving average.

You might also like:

“It would be extremely important to maintain this level,” said Van de Poppe.

If support holds, ETH could gain against BTC. If not, the chart points to lower levels in the future.

Meanwhile CW pointed out that the current ETH price range matches previous whale accumulation zones. “The current price is an attractive range for Ethereum whales,they noted. The realized price of large accumulation portfolios is close to current levels.

However, data from analyst Ali Martinez shows that whale ownership has steadily declined since early January. Ethereum ETFs have also posted losses lately. Price weakness and reduced investment indicate that caution remains on the larger accounts.