Ethereum eyes $2.9K – Traders, should you expect the rally to cool down?

Ethereum has rallied strongly, beating the five-month downtrend in style The largest altcoin’s momentum spurred the market into a bullish frenzy Ethereum [ETH] led the altcoin surge, rallying 47% in five days. During this time, BTC was up 7.9%. Predictably, this saw the Bitcoin Dominance drop from 65.36% to 62.38% in six days. The altcoin market added $232 billion during the same period. The Pectra upgrade was attracting more than just retail investors . It also witnessed selling pressure with whale deposits into centralized exchanges. Ethereum nears the 50% retracement level- breakout, or... Source: ETH/USDT on TradingView The OBV had been in a steady downtrend throughout the year. That changed over the past month, and the trend reversal on the OBV was a sign that buyers were dominant. The CMF agreed with this finding. Its reading was at +0.25, indicating heavy capital inflows to the market. The MFY was also rising, to show bullish momentum and capital flow. However, the indicator did not form a bearish divergence on the 1-day chart yet. Therefore, there was more room for Ethereum to rally. The Fibonacci levels plotted based on the 2025 downtrend showed that the 50% level at $2,774 was nigh. Source: Coinglass The liquidation map highlighted the lack of short liquidations overhead. High leverage long positions were open, and a drop to $2.4k and $2.5k would wipe out many of these positions. This meant traders should be wary of a southward liquidity hunt. Source: Coinglass The 6-month liquidation heatmap showed the $2.9k region was a strong magnetic zone. ETH was headed to this level sooner or later, but a breakout beyond it was not a guarantee. Bullish Bitcoin [BTC] and macroeconomic conditions might need to line up with an ETH move to $2.9k to catalyze a move beyond the $3k psychological resistance. Source: Coinglass The 1-month liquidation heatmap shows Ethereum consolidating around $1.8K in early May, triggering short liquidations at $1.9K before pushing higher. A similar but less intense pattern has emerged in recent days. Liquidity has built up near the $2.7K zone, with ETH already claiming some of it. Over the coming days or weeks, further consolidation below $2.8K is possible before a rally. Meanwhile, traders and investors may consider booking profits and preparing for a potential retracement, as whale selling activity has increased recently. Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion Share Share Tweet