Ethereum Faces Fresh $2,400 Test as Bearish Trend Persists

Ethereum rebounded 3.5% to $2,393 on May 4 before facing rejection at $2,400 and stabilizing around $2,370, according to crypto.news. It is the second time in a month ETH has moved above $2,400 before losing momentum, leaving a question over whether resistance can turn into support or whether the move remains another short-lived rally.

ETH’s daily structure still leans bearish

According to a technical breakdown from CryptoPotato analyst Shayan Markets, Ethereum’s daily chart has been printing lower highs and lower lows for months, with price trading below both the 100-day moving average near $2.5k and the 200-day moving average near $3.2k. Both are acting as dynamic resistance, reinforcing the broader downtrend bias rather than confirming a reversal.

The bounce off the $1.8k demand zone was technically meaningful, Shayan Markets noted, as the level has historically served as a strong demand zone. That move pushed ETH into the $2.2k–$2.4k region – a former breakdown area now acting as a key supply zone – but the price stalled there, with repeated rejections signaling sellers remain in control at higher levels.

The 4-hour chart shows a textbook fakeout

Zooming into the 4-hour timeframe, ETH had been forming an ascending channel with higher lows, a pattern typical of a controlled bullish retracement inside a larger downtrend. Recent price action near $2.3k–$2.4k broke that structure: the asset briefly pushed above the channel resistance and supply zone, only to be quickly rejected, per the CryptoPotato analysis.

That kind of move traps late buyers and signals exhaustion rather than strength. Following the rejection, ETH dropped back inside the channel to trade around $2,150, with RSI flashing overbought at the recent highs even as price climbed, indicating weakening buying strength. Ether then bounced from the channel’s lower boundary, setting up another possible test of the $2.4k supply zone. Related recent volatility across the space is covered in CoinNews’ look at BTC and ETH’s sharp swings.

Sentiment data is improving but unconfirmed

The Taker Buy Sell Ratio has ticked up toward and slightly above the neutral 1.0 level for the first time in nearly two years, indicating aggressive market buyers are becoming more active. But that shift follows a prolonged stretch below 1.0 dominated by sellers, and sudden upticks during a downtrend can mark short-term relief rallies rather than trend reversals.

The lack of strong follow-through in price despite rising buy pressure suggests passive sellers are still absorbing demand at these levels. A more convincing signal would require the ratio holding consistently above 1.0 alongside actual higher highs in price.

Ethereum bearish case: a break below $2k opens $1.8k

If ETH fails to hold the psychological $2k level, the market could revisit the $1.8k demand zone that supported the initial bounce. A breakdown below that support would likely accelerate bearish momentum and expose lower levels, potentially triggering panic selling, per the CryptoPotato technical read.

Ethereum bullish case: $2.4k close opens the door to $2.8k

A decisive daily close above $2.4k would be the first meaningful sign of strength, potentially shifting market structure and opening the path toward the next major resistance at $2.8k, according to the same analysis. Separately, crypto.news reported on May 4 that ETH was approaching a bullish MACD crossover on the daily chart, while the Supertrend indicator had remained in an uptrend configuration since mid-March.

Supporting factors cited by crypto.news on the same date include more than $100 million in net ETF inflows following a four-day negative streak, and exchange reserves falling to 14.5 million ETH, the lowest level since mid-2016, indicating reduced selling pressure. Broader staking and liquidity dynamics are explored in CoinNews’ coverage of ETH staking ratios and ETF liquidity and Fidelity’s proposed ether staking strategy.

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