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The price of Ethereum has risen by about 4% in the last seven days, showing new strength after months of pressure. The move stands out because corresponding earnings are still down about 33% over the past three months, maintaining the broader negative trend so far.
The recent rout has finally broken that bearish structure. But like the reverse trend, a new risk is emerging, which can determine whether it continues or stops. Disproving this risk requires an increase of 10%.
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Ethereum breaks a bearish structure, but the momentum is not entirely
Ethereum was commercial Within a down channel since the beginning of October, it is a structure that reflects a controlled downward trend in which each bounce falls lower than the one before. This week, the price finally pushed above the upper trend line, which indicates that the bearish structure has broken.
This explosion did not happen by chance. Between October 10 and December 18, the price of Ethereum recorded a lower low, while the Relative Strength Index (RSI) recorded a higher low. The RSI indicator measures momentum. When the price is falling, but the RSI is rising, this often indicates weak selling pressure. This bullish divergence helped pave the way for a trend reversal.
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However, the inversion is not frictionless.
Between December 10th and January 5th, Ethereum price forms a lower high (still incomplete), while the RSI forms a lower high.
This creates a subtle bearish divergence, which often signals consolidation or pullback rather than a complete failure of the trend. If the next candle forms below $3,220, you will confirm the bearish pattern.
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This indicates that Ethereum has reversed the downward trend, But he has not yet fully demonstrated his strength.
The resulting risks are high, even with whales involved
The biggest short-term repayment risk comes from the positioning of derivatives.
On Binance’s ETH/USDT settlement chart, the long settlement leverage is about $2.20 billion, while the short settlement leverage is only about $303 million. A long exposure is more than seven times greater than a short exposure. When positioning becomes so sideways, even a small pullback can lead to forced selling.
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The denser liquidation clusters show that long liquidations start around $3,150 (current price) and extend towards $2,850 (shown on the price chart), which has been strong support since early December. A sudden movement in this area could trigger a cascade, which could drag down the price of Ethereum.
As for the whales, it tends to turn in the other direction, showing strength in the spot markets.
Just last weekend, it increased Ethereum whales Their holdings increased from 101.31 million ETH to 101.63 million ETH, adding about 320,000 ETH. At current prices, this accumulation is worth about $1 billion. This indicates that large investors are looking for upside rather than preparing for an exit.
However, whale accumulation does not eliminate liquidation risks. It’s just compensating.
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The 10% test that determines the next step for the price of Ethereum
Ethereum price levels Now more important than narratives.
Ethereum is currently trading in the same $3,220-$2,850 range that has defined the price action since early December. As long as ETH remains in this range, liquidation risks remain high.
A move above $3,470 will be crucial. This level represents an upside of around 10% compared to current prices and will negate the hidden bearish bias by pushing the price to a higher high. Liquidation will also keep Ethereum out of the denser long liquidation pool.
If that happens, Ethereum could open the door towards $3,910, followed by $4,250 if the momentum picks up. On the downside, a loss of $2,850 would weaken the reversal thesis and re-expose ETH to deeper risks.
The price of Ethereum has overcome a downtrend, but the breakout is still fragile. A 10% increase is now the difference between a certain reversal and another painful reset.
