Ethereum (ETH) is currently trading at a critical technical support level of $4,470, a zone that previously acted as resistance but has now flipped to support, representing a bullish retest with significant trading volume confluence. However, banking giant Citigroup has issued a bearish forecast, projecting that ETH could drop to $4,300 by the end of 2025.
Citigroup analysts highlight that while network activity remains the primary driver of Ethereum's value, only 30% of recent growth has occurred on Ethereum's base layer, with the majority shifting to Layer 2 solutions. This structural change leaves ETH trading above model estimates and increases the probability of a correction if key supports are lost. The bank's base case targets $4,300, with a bullish scenario of $6,400 if the bull market continues, and a worst-case scenario of $2,200.
Technically, a breakdown below $4,470 could trigger a deeper correction toward $4,300, where strong support confluence exists, including the range point of control, value area low, and the 0.618 Fibonacci retracement level. Despite recent positive momentum from Ethereum ETFs, Citigroup's analysis suggests the asset may be overvalued given the migration of activity to Layer 2s.