Ethereum, Can It Break $2,400 Amidst Individual Selling?

▲ Ethereum (ETH)/ChatGPT Generated Image ©

Ethereum (ETH) is holding above $2,300, but the market is divided over whether the uptrend can continue, as individual investor selling and bearish signals from the derivatives market accumulate simultaneously.

According to the investment media outlet FXStreet on May 5 (local time), Ethereum traded around $2,380, rising 0.8% in a day and over 3% in the past week. However, key on-chain indicators continue to show bearish signals, and the price is currently continuously testing the $2,388 resistance level.

On-chain data highlighted individual investor selling. According to CryptoQuant, wallets holding 100-1,000 ETH and 1,000-10,000 ETH sold approximately 820,000 ETH over the past week, with a total sell-off of about 1.5 million ETH over two weeks. Santiment's 90-day Mean Coin Age metric also plummeted, indicating an increase in selling pressure primarily from short-term holders.

Staking flows also reflected weakness. Approximately 300,000 ETH were unstaked over the past week, marking the largest outflow since November last year. However, whale investors showed a contrasting movement, accumulating an additional 230,000 ETH during the same period.

A bearish sentiment is evident in the derivatives market. Ethereum's Open Interest (OI) slightly increased to over 14 million ETH, but the funding rate has remained in negative territory for over a month. This indicates that derivatives traders are generally betting on a decline. In the past 24 hours, liquidations totaling $38.7 million occurred, with $26.1 million of that attributed to short position liquidations.

Technically, the bullish structure is maintained. Ethereum is trading above the 20-day, 50-day, and 100-day Exponential Moving Averages (EMA), continuing its short-term upward trend. The Relative Strength Index (RSI) is at 59, remaining in the pre-overbought stage, and the Stochastic indicator also suggests solid momentum in the mid-70s. Upper resistance levels are $2,388, followed by $2,746 and $3,411 as key target zones. Conversely, lower support levels are formed consecutively at $2,305, $2,260, $2,211, and $2,107.

Ultimately, Ethereum has entered a 'tug-of-war phase,' maintaining price defense amidst individual investor selling and a weak derivatives market. The ability to break above $2,388 is a critical turning point that will determine short-term direction; if surpassed, an upward expansion is possible, but if support levels are broken, selling pressure could intensify again.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. This content should be interpreted for informational purposes only.*