Ethereum price reached an expected breakdown target of nearly $1,800 in early February. It fell to $1,740 before rebounding. Since then, ETH has recovered around 23%, giving traders hope that the worst may be over.
However, price rebounds within a downtrend often appear strong at first. The real question is whether this rally is supported by strong buyers. At the moment, charts, on-chain data, and technical indicators suggest that support remains weak. Several warning signs still point to downside risks.
ETH price breakdown worked, but rebound lacks real power
As predicted by BeInCrypto analysts, on February 5th, Ethereum completed a major breakdown pattern on the daily chart. This pattern usually indicates that sellers are in control. The expected target was close to $1,800. The price of Ethereum followed suit, dropping to $1,740 on February 6th.
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After reaching this zone, ETH rebounded by about 23%. At first glance, this appears to be a strong bullish buy as the price candlestick on February 6th saw a significant downside. However, momentum is a different story.
From February 2nd to February 8th, prices fell off their highs. At the same time, the relative strength index (RSI), which tracks short-term momentum, rose.
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This creates a hidden bearish divergence where momentum improves but price does not follow.
Simply put, short-term momentum looks good, but prices are slow to rise. This usually means that the seller is still operating in the background. Therefore, the breakdown goal was achieved, but the rebound still does not show deep conviction.
This weak follow-through sets the stage for the next risk.
Short-term rebound is slipping into another bear market
The next thing to look at is the structure of the movement, as the rebound lacks a strong follow-through. On the 12-hour chart, Ethereum is forming a bearish pole and flag.
First, prices have dropped significantly. It then rebounded within the ascending channel. This is a typical continuation pattern in a downtrend.
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Another leg often goes down as the volume confirms the risk. On-balance sheet volume, which tracks actual buying and selling activity, remains weak. It’s not rising aggressively like prices. This means there are fewer real buyers supporting the rally. Additionally, the OBV metric itself is nearing a break below its own uptrend line. This flag structure can fail if the volume fails.
That would open the door to deeper losses of around 50% from the lower trendline level. We need to look on-chain to understand whether the buyers who led the 23% rally can stop it.
Do long-term holders sell and short-term traders buy?
On-chain data shows that the recent rally has been driven primarily by short-term traders rather than long-term investors.
The key indicator here is the short-term holder NUPL, which measures whether recent buyers have made profits or losses.
In early February, as Ethereum fell to $1,740, short-term holder NUPL fell to around -0.72, firmly in capitulation territory. This reflects large unrealized losses by recent buyers.
However, during the 23% rebound, NUPL recovered to around -0.47. This is about a 35% improvement from the bottom. Although still negative, the speed of the recovery shows that many short-term traders have rushed to buy on the bullshit.
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This pattern is very similar to bottom formations that have failed in the past.
Also on March 10, 2025, NUPL recovered to around -0.45 and ETH traded near $1,865. At the time, many traders believed that a bottom had formed. A more durable bottom appeared on April 8, 2025, when NUPL fell to near -0.80, about 75% deeper than March levels. This phase marked the depletion of true sellers and preceded a sustained recovery. The price at the time was approximately $1,470.
Today’s structure looks much closer to March 2025 than April 2025. Losses have eased too quickly, suggesting the panic has not completely subsided. At the same time, long-term holders remain cautious.
The 30-day rolling Hodler Net Position Change, which tracks investors who have held ETH for more than 155 days, remains negative. The outflow amount on February 4th was around -10,681 ETH. By February 8th, the range had widened to around -19,399 ETH.
This represents an approximately 82% increase in net sales in just four days. This indicates weak confidence at current levels. Therefore, the pullback is primarily driven by short-term traders chasing the pullback, while long-term investors continue to reduce their exposure.
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Key Ethereum Price Levels Show Why $1,000 Risk Still Exists
All technical and on-chain signals indicate weak structure. Ethereum needs to regain key resistance to stay safe. The first resistance level is near $2,150.
Above this, short-term pressures will ease. The primary deactivation level is $2,780.
Only beyond this will the bearish structure truly break down. On the downside, the risks remain high.
The main support levels are:
$1,990: Short-term support $1,750: Fibonacci support $1,510: Major retracement zone (close to bottom on April 8, 2025) $1,000: Bear flag prediction
The rebound will weaken if the price closes below $1,990 for the day. Losing $1,750 exposes the $1,500 ETH price range. If the bearish flag completely collapses, the predicted move would be towards $1,000.
This would mean a drop of nearly 50% from current levels. At the moment, Ethereum is still below major resistance.
The volume is low. Long-term holders are selling. And short-term traders dominate trading. Until these conditions change, the risk of significant fluctuations in Ethereum’s price remains real.
