Ethereum’s recent bullish breakout has sparked excitement among crypto enthusiasts, but emerging signs suggest that this momentum could be short-lived. A critical reversal pattern and bearish signals are painting a worrisome picture for ETH investors.
Bearish Divergence Signals Caution for Ethereum
Over the past three weeks, Ethereum has shown clear signs of a bearish divergence. Although the price has been forming higher highs, the Chaikin Money Flow (CMF) indicator is posting higher lows. This divergence indicates that the price appreciation is accompanied by rising capital outflows rather than sustained inflows—a red flag signaling potential weakening internal strength.
This divergence is a classic indicator of a possible trend reversal. Data reveals that many investors are distributing their ETH holdings into strength, instead of accumulating more. This outflow of capital reduces Ethereum’s upside momentum, particularly at a time when the broader crypto market is showing caution.
Large Whale Activity Adds to Downward Pressure
On-chain data reinforces the bearish outlook. Wallets holding between 100,000 and 1 million ETH have sold over 230,000 ETH in the past week—totaling an estimated $760 million at current prices. This selling pressure aligns with the declining CMF, underscoring reduced confidence among major holders (also known as whales).
When large holders sell during breakouts, price sustainability becomes less likely. This opens up the potential for ETH to retest and possibly lose critical support levels, particularly if bearish momentum continues to gain traction.
Current Market Outlook and Key Price Levels
At the time of writing, Ethereum is trading near $3,309, just above a significant $3,287 support level. While the bullish triangle breakout initially projected a 29.5% move, targeting $4,240, the fading momentum now risks invalidating that structure.
If Ethereum fails to hold the $3,287 support level, the price could decline further to $3,131, signaling a deeper correction. Conversely, a successful bounce from $3,287 combined with reduced whale selling could reignite bullish momentum, pushing Ethereum back toward $3,441 and potentially higher to $3,802.
How to Navigate Ethereum’s Uncertain Future
Given the uncertain landscape surrounding Ethereum, investors may want to focus on reliable tools and platforms for monitoring market sentiment. For example, Ledger’s Nano X hardware wallet provides secure crypto storage while allowing investors to keep track of their portfolio during volatile times. Additionally, staying informed through trusted crypto news outlets helps in making more strategic decisions.
Ultimately, price movements remain unpredictable, and personal research is imperative. Investors should approach the market carefully, keeping an eye on key support and resistance levels to better gauge potential outcomes.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Always consult with a professional before making financial decisions.
