As Ethereum continues to hover around the $2,500 mark, signs indicate that the market is beginning to exhaust itself. Analysts believe the second-largest cryptocurrency by market capitalization may face a short-term pullback before attempting to break through higher resistance levels.

Ethereum is showing signs of overheating

According to a CryptoQuant Quicktake post by collaborator ShayanMarkets, ETH is beginning to show signs of an overheated bull run. The analyst shared the following chart illustrating the total trading volume of ETH across various cryptocurrency exchanges.

In this chart, the size of each bubble reflects the scale of trading volume, while the color indicates the rate of change in volume, categorized into four groups – Cooling, Neutral, Overheated, and Too Hot.

Ethereum's continuous bullish rally, which began in mid-April 2025, has seen a significant increase in trading activity. Within just one month, the market status of the asset shifted from Cooling (green bubble) to Overheated (red bubble).

The current overheating situation could lead to a short-term correction as the market cools down and enters another accumulation phase. However, the depth and duration of any potential pullback remain uncertain.

A contributor from CryptoQuant believes that the spike in volume is due to profit-taking and significant supply resting at the important psychological resistance level of $2,500. Data from CoinGecko shows that ETH has surged an impressive 59.7% in the past 30 days, outperforming Bitcoin (BTC) in the same period. ShayanMarkets concluded:

Therefore, Ethereum is expected to continue the consolidation phase until new demand emerges to drive a breakout above this resistance range in the medium term.

In a separate post on X, veteran cryptocurrency analyst Ali Martinez pointed out the extreme price divergence of Ethereum's Market Value to Realized Value (MVRV). He emphasized that ETH must hold above $2,200 to maintain bullish momentum. If this level is sustained, Martinez believes that ETH could target $3,000, or even potentially $4,000, if buying pressure increases significantly.

Where Is ETH Heading? Analysts Weigh In

The impressive performance of Ethereum has recently drawn the attention of several cryptocurrency analysts, who are now speculating about the future price trajectory of this digital asset. According to cryptocurrency analyst Ted Pillows, the 12-hour chart of ETH recently confirmed a Golden Cross, a bullish signal that often precedes significant price increases.

In another analysis, Pillows predicted that ETH could head towards $4,000, noting that this asset has been trading within a large symmetrical triangle since Q3 2020. The $4,000 level lies just below the upper boundary of the triangle.

Conversely, cryptocurrency analyst Gianni Pichichero has warned of the potential retreat to $2,350, citing the appearance of lower lows on Ethereum's daily chart as a bearish signal. At the time of the press report, ETH was trading at $2,500, up 3.6% in the past 24 hours.