Ethereum, Can it Break $2,400 Amidst Individual Investor Selling?

▲ Ethereum (ETH)/ChatGPT Generated Image ©

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

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

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

Staking flows also reflected bearish sentiment. Approximately 300,000 ETH were unstaked in the past week, marking the largest outflow since November last year. However, whale investors showed opposing movements, accumulating approximately 230,000 ETH during the same period.

A clear bearish trend 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 attributed to short position liquidations.

Technically, the upward structure is maintained. Ethereum is trading above its 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, staying before the overbought stage, and the Stochastic indicator also suggests solid momentum in the mid-70s. Upper resistance levels are indicated at $2,388, followed by $2,746 and $3,411 as key target zones. Conversely, lower support levels are formed sequentially at $2,305, $2,260, $2,211, and $2,107.

Ultimately, Ethereum has entered a 'tug-of-war zone,' maintaining price defense despite individual investor selling and a bearish derivatives market. Whether it breaks $2,388 is a critical turning point for its short-term direction; a breach could lead to upward expansion, but a break below support could intensify selling pressure again, according to analysis.

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