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Ethereum surged nearly 40% last week, increasing from a low of $1808 on May 8 to $2600 on May 10 as risk appetite returned to digital assets and amid a major network update.
According to market observers, Ethereum's Pectra update, which went live on May 7, served as a catalyst for fresh interest in the world's second-largest cryptocurrency. Pectra, which follows last year's Dencun upgrade, increased staking limits and wallet usability.
After surpassing $2,500 on May 10, the rally stalled, with Ethereum falling to a low of $2,407 on Monday.
In a recent tweet, on-chain data analytics platform Glassnode shed light on Ethereum's recent price action.
According to Glassnode, Ethereum's sharp move above $1,800 to above $2,500 was aided by the low supply concentration in that range.
However, the rally stalled near $2,580, a massive sell wall holding nearly 1.3 million ETH. The advance into the sub-$2,500 zone was quick, aided by relatively little supply and low selling pressure. However, Ethereum's momentum cooled significantly as the price approached the $2,580 level, where 1.3 million were previously held.
Glassnode revealed that as Ethereum neared this level, this supply began to decline, dropping to just one million ETH, a sign that many holders opted to exit their positions near their cost basis, cashing in on the recent rally.
What's next for ETH price?
At press time, Ethereum was down 2.14% in the last 24 hours to $2,497, mirroring the profit-taking on the larger crypto market, which saw $606 million in liquidations in the same period.
Bulls are attempting to push the ETH price beyond $2,500, but bears have maintained the selling pressure.
If the price falls below $2,435, Ethereum might drop to $2,320. If the price rebounds from $2,320, the bulls will try to restart the upward trend. Eyes will still be at the $2,580 resistance, as indicated by Glassnode, with one million ETH left there.
The next resistance is at $2,850, but if that is overcome, ETH might reach $3,000.
On the other hand, if the price falls and breaks below $2,320, it indicates that the bulls are taking profits. ETH may drop to $2,110, which is expected to serve as support.
Vladislav Sopov
Dan Burgin