Ethereum Faces Potential Pullback as Technical Signal Emerges
Ethereum’s recent rally towards $2,500 is showing signs of exhaustion as a key technical indicator, the TD Sequential, flashes a sell signal on the 3-day chart. This development suggests a potential short-term reversal for ETH, which has been on an upward trajectory from sub-$1,800 levels earlier this month. Despite the current bullish momentum, ethereum remains significantly below its all-time high, presenting both opportunities and risks for traders and investors.
Ethereum Faces Potential Pullback as Technical Signal Emerges
Ethereum’s rally toward $2,500 shows signs of exhaustion as the TD Sequential indicator flashes a sell signal on the 3-day chart. The pattern, marked by a completed "9" count, historically precedes short-term reversals when trends lose momentum.
Key resistance looms NEAR $2,530 while $2,500 acts as immediate support. Despite climbing from sub-$1,800 levels earlier this month, ETH remains 48.68% below its all-time high. Trading volume has flattened during this consolidation phase, reflecting cautious market participation.
Analyst @ali_charts highlighted the technical warning on May 17, 2025. The signal suggests traders may take profits after the recent uptick, though the broader recovery from yearly lows keeps intermediate-term bulls engaged.
Ethereum Outperforms S&P 500 Amid Profit-Taking Pressure
Ethereum’s 58% rally since February has eclipsed the S&P 500’s gains, with ETH posting a 19.6% year-to-date surge according to Artemis data. The asset continues dominating cryptocurrency liquidity flows despite recent stagnation in bullish momentum.
Lower timeframe charts now suggest potential near-term downside as traders capitalize on profits. This profit-taking behavior contrasts with ETH’s fundamental strength - its growing market dominance positions it as a primary conduit for institutional capital entering crypto markets.
Ethereum Tests Key Support Level Amid Bullish Signals
Ethereum’s price action is approaching a decisive juncture as it holds above the 200-day exponential moving average near $2,500. The second-largest cryptocurrency by market capitalization has transformed this former resistance level into support following its May breakout—a technical development that often precedes sustained upward momentum.
Traders are watching for a confirmed close above the 200 EMA, a signal that historically correlates with long-term trend reversals. A successful retest could propel ETH toward the psychologically significant $3,000 level. Market participants note that similar technical setups in Q4 2023 preceded rallies exceeding 40%.
Divergence between price and trading volume introduces caution. The current consolidation occurs on diminishing volume, suggesting weakening buying pressure. Such conditions frequently precede either breakout continuation or sharp pullbacks, leaving Ethereum at an inflection point.
Ethereum Price Fails to Break Through Key Resistance Level
Ethereum’s price faced rejection near the $2,520 resistance level, triggering a corrective phase that saw ETH test support at $2,320. The second-largest cryptocurrency now trades below both the psychological $2,500 level and its 100-hour moving average, with technical indicators suggesting potential further downside toward $2,220.
A bearish trend line has emerged on hourly charts, with resistance currently firming near $2,540. Market participants await a decisive break above $2,550 to signal renewed bullish momentum. The current pullback represents a 50% retracement of the recent upswing from $2,308 to $2,509.
Ethereum Revisits December 2024 Market Signals Amid Price Correction
Ethereum’s recent 11.5% drop from $2,738 to $2,426 has reignited debates about investor sentiment. The decline coincided with the largest single-day ETH withdrawal from exchanges since early April, suggesting accumulation despite price weakness.
Market analysts interpret the rejection at $2,800 as a temporary reset rather than a full reversal. The Coinbase Premium Index divergence hints at institutional activity, while exchange netflows paint a contradictory picture of selling pressure versus long-term holding.
Technical indicators warn of potential deeper corrections, though the underlying on-chain data reveals strategic positioning by savvy investors. This echoes patterns last seen during December 2024’s accumulation phase, when ETH eventually broke upward after similar volatility.
Vitalik Buterin Proposes Ethereum Node Accessibility Improvements
Ethereum co-founder Vitalik Buterin has outlined a proposal to enhance user-friendliness for individuals operating local nodes. The initiative targets scalability challenges on Ethereum’s LAYER 1, where persistent high gas fees and escalating data demands continue to strain the network.
Buterin emphasized the critical role of full nodes and personal RPC servers in maintaining network health. His proposal seeks to lower barriers to entry, as current node operation remains resource-intensive. With 10,051 active nodes recorded on May 19 and a blockchain size exceeding 1.3TB—growing at 20% annually due to DeFi and Layer 2 activity—the changes could prove pivotal for decentralization.
