Ethereum continues to hold its recent breakout gains, trading around $3,730 after a powerful leg up from the $2,500 range. This rally has pushed ETH into a critical technical zone, while on-chain metrics offer insight into market sentiment. Despite the sharp move, we’re not seeing overwhelming signs of euphoria yet.

Technical Analysis

By ShayanMarkets

The Daily Chart

On the daily chart, ETH is consolidating just below the $4,000 level after breaking through key resistance at $3,300. The asset is firmly above both the 100-day and 200-day moving averages, which are also starting to curl upward following a bullish crossover around the $2,500 mark, suggesting a strong uptrend structure.

The next major level of interest is the previous high at $4,100, while any downside correction could find support between $3,300 and $2,900.

Moreover, the RSI on the daily remains elevated, hovering around 78, which signals overbought conditions. That said, a sharp reversal hasn’t followed yet, implying that momentum remains intact for now. If the buyers can maintain pressure without a significant correction, ETH could build the base needed for continuation toward the previous highs of December 2024.

The 4-Hour Chart

On the 4H chart, ETH is forming a descending triangle just beneath resistance, with a series of lower highs pressing into the $3,800 zone. The RSI has also bounced from the 50 level, currently sitting near 56, showing a mild recovery in momentum after the recent pullback. The structure suggests that a breakout above the descending trendline could trigger another wave higher.

If the pattern breaks to the downside, however, the immediate support to watch is the $3,500 range. A move below that would put the $3,200 zone back into play. For now, volatility is compressing, and a decisive breakout in either direction is likely in the coming sessions.

On-Chain Analysis

Ethereum Exchange Reserve

The Ethereum exchange reserve continues to decline, now sitting at a multi-year low of around 19.3 million ETH. This sustained downtrend reflects a broader shift in market behavior, where investors and institutions are increasingly moving their ETH off centralized exchanges, either into cold storage, staking platforms, or DeFi protocols. Historically, such a reduction in exchange-held supply often coincides with bullish price trends, as it signals reduced sell-side pressure and a stronger conviction among holders.

Whats notable is that this drawdown in reserves has continued even as ETH surged toward $3,800, indicating that holders aren’t rushing to take profits at current levels. Instead, this behavior reinforces the idea of long-term accumulation and reduced willingness to sell, especially during key breakout phases. As long as this reserve continues trending downward, it adds a strong underlying support to Ethereum’s macro bullish structure.

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