Ethereum has staged a technical rebound following last week’s sharp correction, but there are many factors indicating caution.
Technical Analysis on the Daily Chart
On the daily chart, ETH recently broke down from an ascending channel formation that had been building for weeks. This pattern, often bearish, played out with a sharp drop that found support at the $2,200 region. After tagging this level, ETH bounced aggressively and is now retesting the lower boundary of the channel. The confluence of these resistances makes this zone critical.
Short-Term Analysis on the Hourly Chart
On the hourly chart, Ethereum tested the bullish Fair Value Gap (FVG) created during the recent bounce, using it as support to climb higher. The short-term structure will flip bullish if the price breaks back into the channel, invalidating the bearish pattern effectively.
Ethereum Exchange Reserves Analysis
Data on Ethereum reserves at centralized trading platforms shows that they have dropped to 18.8 million ETH, the lowest level in recent years. This steady decline reflects reduced selling pressure and a strong preference for self-custody.
The price recovery of Ethereum may be short-lived unless key resistance levels are reclaimed. While declining reserves may indicate long-term strength, short-term risks still remain.
