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Ethereum has been one of the top-performing crypto assets since early April, rallying more than 100% from its cycle lows near $1,600 to a recent high above $2,700. This sharp recovery positioned ETH as a leader in the broader market’s bullish trend, even sparking renewed discussions around a potential altseason.
However, momentum now appears to be fading. Over the past week, ETH has struggled to break above key resistance levels, and selling pressure is beginning to mount as global macroeconomic conditions grow increasingly uncertain.
Despite these headwinds, one key on-chain signal suggests long-term confidence remains strong: data from Glassnode reveals that Ethereum’s supply on centralized exchanges has dropped to its lowest level in seven years. This trend, typically interpreted as a sign of reduced selling pressure, indicates that investors may be increasingly moving ETH to self-custody wallets, possibly in anticipation of further upside. As ETH flirts with critical support levels, this deep reduction in exchange supply could act as a stabilizing force, reinforcing the asset’s long-term bullish case amid short-term uncertainty.
Ethereum Faces Key Breakout Test As Supply On Exchanges Plunges
Ethereum is currently trading at a critical juncture, consolidating around the $2,500 mark after a strong rally that began in early April. Many investors believe this consolidation phase could be the calm before a breakout, potentially pushing ETH into new highs and setting the stage for a broader altseason. The recent pullback has been orderly so far, with price action respecting major support zones, and market participants remain cautiously optimistic.
Despite persistent global tensions—including rising US Treasury yields and continued trade uncertainty between the US and China—Ethereum’s fundamentals appear to be strengthening. One of the most bullish signals comes from top analyst Quinten Francois, who highlighted on-chain data showing that Ethereum’s supply on centralized exchanges has now fallen to its lowest level in seven years. This development is critical because it signals a deep reduction in potential sell-side pressure.
When fewer coins are available on exchanges, it typically indicates that investors are moving their holdings to long-term cold storage rather than preparing to sell. In the past, such shifts have often preceded major price surges. If demand increases while supply remains limited, the market could face a supply shock, fueling a rapid move to the upside.
This setup has led analysts and traders to watch Ethereum closely, as it continues to form a base just below key resistance around $2,700. A confirmed breakout above this level, paired with the shrinking supply on exchanges, could trigger aggressive buying and potentially kick off a new phase of bullish momentum. With confidence building and long-term fundamentals improving, Ethereum’s current consolidation might just be the final pause before a major leg higher.
ETH Holds Crucial Support Amid Market Pullback
Ethereum (ETH) is currently trading around $2,484, showing signs of consolidation after several attempts to break through the $2,700 resistance zone. On the 4-hour chart, price action reveals a gradual decline from recent highs, with lower highs forming and ETH slipping below the 34 EMA ($2,557). This breakdown below the short-term moving averages suggests weakening momentum, while the price now hovers just above the 100 SMA ($2,559), a level that has acted as dynamic support in previous retracements.
Volume has also decreased slightly during this pullback, indicating that the recent selling may lack strong conviction. However, if ETH fails to reclaim $2,550 in the next few sessions, bearish momentum could accelerate toward the 200 SMA at approximately $2,358.
On the bullish side, this consolidation above $2,450 continues to show resilience, especially given the macroeconomic backdrop and market-wide volatility. If Ethereum can hold this range and reclaim the 34 EMA with strong volume, it could stage a rebound and retest the $2,650–$2,700 zone, a critical level for a breakout.
Featured image from Dall-E, chart from TradingView
Sebastian’s journey into the world of crypto began four years ago, driven by a fascination with the potential of blockchain technology to revolutionize financial systems. His initial exploration focused on understanding the intricacies of various crypto projects, particularly those focused on building innovative financial solutions. Through countless hours of research and learning, Sebastian developed a deep understanding of the underlying technologies, market dynamics, and potential applications of cryptocurrencies.
To share his insights with others, Sebastian became an active contributor to online discussions on platforms like X and LinkedIn. His focus on fintech and crypto-related topics quickly established him as a trusted voice in the online crypto community. Sebastian’s goal was to educate and inform his audience about the latest trends and insights in the rapidly evolving crypto landscape.
To further enhance his expertise, Sebastian pursued a UC Berkeley Fintech: Frameworks, Applications, and Strategies certification. This rigorous program equipped him with valuable skills and knowledge regarding Financial Technology, bridging the gap between traditional finance and decentralized finance. The certification deepened his understanding of the broader financial landscape and its intersection with blockchain technology.
Sebastian’s passion for finance and writing is evident in his work. He enjoys delving into financial research, analyzing market trends, and exploring the latest developments in the crypto space. In his spare time, Sebastian can often be found immersed in charts, studying 10-K reports, or engaging in thought-provoking discussions about the future of finance.
Sebastian’s journey as a crypto pioneer has been marked by a relentless pursuit of knowledge and a dedication to sharing his insights. His ability to navigate the complex world of crypto, combined with his passion for financial research and communication, makes him a valuable contributor to the industry. As the crypto landscape continues to evolve, Sebastian remains at the forefront, providing valuable insights and helping to shape the future of this revolutionary technology.
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