Ethereum Struggles Below $2,000 Amid Upgrade Uncertainties, Despite Market Rally

Ethereum's price has been struggling to surpass the $2,000 mark, despite a broader market recovery. This stagnation is largely attributed to uncertainties surrounding the Pectra network upgrade and ongoing concerns about the network's long-term sustainability. These issues have overshadowed the positive impact of cooler-than-expected US inflation data, which was released in the CPI report on Wednesday.

While other top altcoins such as Chainlink, Hedera, and sui experienced double-digit gains during the market rally, Ethereum's price failed to advance above $2,000. At the time of reporting on Thursday, Ethereum was trading at $1,887, down 4% despite the overall bullish sentiment in the broader market.

In a significant development, the US House of Representatives has passed a bill to repeal an irs rule that required decentralized finance (DeFi) brokers to report user transactions similar to traditional securities brokers. This rule, implemented under the Biden administration, aimed to enhance tax compliance but faced opposition due to concerns about its impact on crypto innovation and the potential for companies to relocate overseas. Led by Rep. Mike Carey and Sen. Ted Cruz, the bill has gained traction and is now awaiting final approval from President Donald Trump. If approved, this move could create a more favorable regulatory environment for the cryptocurrency sector, potentially boosting the appeal of various DeFi services built on the Ethereum network.

Despite Ethereum's price languishing below $2,000 for two consecutive days, recent swings in derivatives market positions suggest that traders are bracing for a decisive bullish reversal. This outlook is supported by the deployment of significant leverage on ETH long positions, indicating a broad consensus among short-term traders expecting considerable upside in the days ahead. While Ethereum's price has declined 3% in the last 48 hours, the excess of long leverage over shorts after a prolonged bearish period is often an early signal of an imminent bullish reversal.

Ethereum's price forecast remains uncertain, with the daily chart revealing a persistent downtrend. The 5-day, 8-day, and 13-day Super SMAs continue to slope downward, reinforcing bearish control as Ethereum trades near $1,881. The long red candlestick marked by the March 1 reversal signaled a critical breakdown, coinciding with an increase in selling volume. Since then, Ethereum has been unable to reclaim lost ground, slipping further below short-term moving averages. The Bull-Bear Power (BBP) indicator at -393.47 highlights extreme selling pressure, confirming a sustained bearish trend. However, a potential bottoming-out scenario emerges if the $1,825 support level holds, as this zone represents the last major accumulation area before the March rally attempt. A rebound from this level could trigger a relief rally toward the $2,018 and $2,111 resistance areas, where previous price consolidations took place. On the downside, continued rejection below the short-term moving averages would embolden sellers, increasing the risk of a liquidity sweep toward $1,750. Meanwhile, rising long leverage, as indicated by derivative market positioning, suggests that traders are positioning for a bullish reversal. If leveraged longs outpace shorts, Ethereum could witness short-covering momentum, accelerating a recovery above $2,000 and keeping hopes of a $2,500 rebound alive.