ETH experienced its largest single-day rally since 2021, rising 31% within 24 hours. This sharp increase followed the successful implementation of the Pectra upgrade, pushing ETH closer to the critical resistance level of $2,500.
However, despite the impressive surge, whether Ethereum can consistently break through this level remains a challenge, as investor behavior could potentially hinder further price movements.
Ethereum Pectra Upgrade Begins
The Pectra upgrade significantly impacted market sentiment around Ethereum, with exchanges recording $156 billion in net inflows. On May 8th alone, $120 billion worth of ETH was sold, marking the highest single-day sales in five months.
This indicates investors' willingness to secure profits after the price surge, which could weaken the potential for continued ETH price increases. Such profit-taking actions may limit ETH's upward momentum.
Ethereum's macro momentum reveals both strengths and potential headwinds. IOMAP (price around profit/loss) analysis shows 11.56 million ETH was purchased between $2,493 and $2,915. This range is crucial for ETH to break through $2,500 and secure recent gains.
However, significant selling pressure exists in this range, with $278 billion worth of ETH present. This could limit Ethereum's ability to sustain growth and poses a high risk of large-scale selling at higher prices.
ETH Price Reaches Two-Month High
Ethereum is currently trading at $2,366, having risen 31% in the past 24 hours following the Pectra upgrade. This price increase has lifted ETH to its two-month high, bringing it closer to the $2,513 resistance level. Breaking through this barrier would be a significant milestone for Ethereum, though maintaining this movement remains challenging in the face of investor selling.
The difficulty in surpassing $2,500 stems from continuous selling pressure from investors who have already realized recent profits and those who might sell if prices continue rising. Consequently, Ethereum may struggle to maintain its upward trajectory and could fall below the $2,344 support. In such a scenario, ETH might test the $2,141 level, potentially erasing some recent gains.
However, if the broader market maintains strength and ETH follows Bitcoin's breakthrough of $103,000, Ethereum could break past $2,513 and establish it as a support level. This would create opportunities for further price increases toward $2,654, invalidating the current bearish outlook and signaling Ethereum's potential recovery toward new price highs.
