$ETH has once again captured the spotlight after retesting its all-time high (ATH) region. However, technical indicators are beginning to suggest a potential cooling-off period, raising the question: is ETH due for a short-term pullback, and should traders consider short positions?
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Evidence of a Pullback
Recent Binance market analysis highlights that ETH approached its ATH near $4,783–$4,953, but failed to sustain momentum above it. Several indicators now point toward overextended conditions:
RSI (6) near 88 and Stochastic K around 91, signaling extreme overbought levels.
MACD momentum weakening, with bearish divergence emerging.
ETH has already seen a 6% correction, sliding from ~$4,953 to ~$4,477.
Bearish divergence on RSI and declining volume reinforce the probability of further downside pressure.
From a technical standpoint, a pullback toward the $3,700–$3,800 zone remains possible. Immediate support lies between $4,400–$4,000, and a failure to hold this range could expose ETH to deeper retracement risk.
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Offsetting Bullish Signals
Despite the short-term correction signals, Ethereum’s long-term fundamentals remain intact:
Strong staking demand continues to reduce liquid supply.
Rapid Layer-2 adoption is boosting scalability and user activity.
Growing institutional inflows are reinforcing market confidence.
Ongoing ETF developments provide additional bullish momentum.
Some analysts even argue that as long as $4,450–$4,600 support holds, ETH could resume its rally toward $5,000–$6,000, with extended upside targets as high as $10,000.
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Summary: Should You Short ETH Now?
Viewpoint Supporting Signals Counterpoints
Short-term bearish Overbought RSI, ATH rejection, bearish divergence Strong fundamentals and support levels intact
Bullish continuation Institutional inflows, staking, ETF optimism A short-term correction may still unfold first
Overall, the charts suggest a near-term pullback toward $4,400–$4,000 remains plausible. That said, Ethereum’s long-term bullish trend is unshaken, supported by strong fundamentals and institutional adoption.
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If Considering a Short Position
Entry Zone: $4,450–$4,500
Target Area: $4,000–$3,800 (key support levels)
Stop-Loss: Above $4,800 (recent ATH)
⚠️ This strategy should be viewed as a short-term tactical trade, not a reversal of Ethereum’s broader uptrend. Traders are advised to apply strict risk management and avoid overleveraging positions.
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🔥 Bottom Line: Ethereum may be gearing up for a short-term pullback, offering tactical opportunities for active traders. However, the bigger picture remains bullish, with long-term investors likely to stay focused on higher targets.