Why Did ETH Price Drop 45% in Q1?
Can Ethereum bounce back from this downtrend?
Ethereum (ETH) faced a rough Q1 2025, marking its worst performance since 2018 with a 45% decline. Despite this downturn, ETH shows signs of recovery, fueled by an upcoming network upgrade and shifting market dynamics.
Price Struggles and Key Levels
Last week, ETH closed below its daily support of $1,861, triggering a 9.88% drop. However, it regained 4.05% at the start of this week, reclaiming the $1,861 level until Tuesday. Currently, ETH trades near this resistance, with a failure to hold possibly leading to a retest of the $1,700 psychological support.
The Relative Strength Index (RSI) on the daily chart reads 40, pointing downward, indicating bearish momentum. If ETH finds support at $1,861, it could recover toward its March 24 high of $2,104.
Read Ethereum Price Prediction for more detailed insights
Ethereum Tops DEX Volumes Amid Market Slowdown
Ethereum led decentralized exchange (DEX) trading volumes in March, surpassing Solana for the first time since September 2024. ETH DEXs recorded $64.69 billion in volume, exceeding Solana’s $52.62 billion, per DefiLlama.
However, overall DEX activity remains subdued compared to the last four months, particularly January’s peak, when Solana and Ethereum hit $258.49 billion and $86.11 billion, respectively. A drop in memecoin activity following President Trump’s tariff announcements contributed to this decline.
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Pectra Upgrade and Q2 Outlook
Ethereum’s upcoming Pectra upgrade—slated for April 30—could be a catalyst for recovery. It introduces key features like wallet recovery, transaction batching, and blob expansion.
Derive’s Head of Research, Sean Dawson, suggests ETH may see further downside in April but expects a rebound toward Q2’s end. He assigns a 22% probability of ETH falling below $1,600 by April 25 and a 17% chance of surpassing $2,000.
With historical trends favoring Q2 for Ethereum, traders will watch if Pectra sparks renewed momentum.