Ethereum Surges 31% Post-Pectra Upgrade, Faces $2,500 Resistance

Ethereum (ETH) has experienced a significant surge, climbing 31% in just 24 hours following the successful implementation of the Pectra upgrade. This substantial price increase has brought ETH closer to a crucial resistance level of $2,500, a milestone that could signal a sustained upward trend. However, the challenge lies in whether Ethereum can breach this level sustainably, as investor behavior may hinder further price movement.

The Pectra upgrade has had a notable impact on market sentiment surrounding Ethereum. Exchanges have recorded net inflows of $15.6 billion since its launch, with $12 billion worth of ETH sold on May 8 alone. This marks the highest single-day sale in over five months, indicating that investors are keen to secure profits after the price spike. This profit-taking behavior could potentially dampen the prospects of ETH continuing its upward movement, limiting its upward momentum.

Ethereum’s macro momentum shows both strength and potential headwinds. The IOMAP (In/Out of the Money Around Price) analysis reveals that 11.56 million ETH were bought in the range between $2,493 and $2,915. This range is crucial as ETH must breach $2,500 to continue its upward trend and lock in recent gains. However, there is significant selling pressure at this range, where $27.8 billion worth of ETH is sitting. This could cap Ethereum’s ability to maintain sustainable growth, as the risk of large-scale sell-offs at higher prices looms large.

Currently, Ethereum’s price is trading at $2,366, up 31% in the last 24 hours following the Pectra upgrade. This price increase has brought ETH to a 2-month high and closer to the $2,513 resistance level. Breaking this barrier would mark a key milestone for Ethereum, but the challenge remains whether it can sustain this movement in the face of investor selling. The difficulty in crossing $2,500 lies in ongoing selling pressure from investors who have already capitalized on recent gains and from those who could sell should the price continue rising. Thus, Ethereum could struggle to maintain its upward trajectory, possibly falling back below the support of $2,344. In this scenario, ETH could test the $2,141 level, potentially erasing some of the recent gains.

However, if the broader market remains bullish and ETH follows Bitcoin’s rise beyond $103,000, Ethereum could break through $2,513 and secure it as a support floor. This would create the opportunity for further upward movement toward $2,654, invalidating the current bearish outlook and signaling that Ethereum could continue its recovery toward new price highs.

In summary, the Pectra upgrade has triggered a significant price jump for Ethereum, bringing it closer to the $2,500 resistance level. While the upgrade has boosted market sentiment and led to substantial inflows, the challenge lies in sustaining this momentum in the face of profit-taking and selling pressure. If Ethereum can overcome these hurdles, it could continue its upward trajectory and potentially reach new price highs. However, the risk of a pullback remains, and investors should remain cautious as the market navigates these challenges.