Ethereum rises 7% on familiar rebound cues, but on-chain data warns of significant risks

Ethereum price has seen a gradual rebound, rising about 7% since March 8 after showing bullish technical signals on the 8-hour chart. The move comes as the broader cryptocurrency market seeks to stabilize. However, the larger trend in Ethereum remains weak. The asset is still down about 31% year-to-date into 2026, underscoring that the broader downtrend remains intact despite the recent rebound.

Interestingly, this rebound follows the technical pattern that caused the strong rally earlier. But this time, several on-chain indicators suggest that the recovery may face even stronger resistance going forward.

Historic bullish divergence sparked 15% rally in early March

The recent rally followed a bullish divergence in the Relative Strength Index (RSI) on the 8-hour chart. RSI is a momentum indicator that measures the speed and strength of price movements. If the RSI forms higher lows while the price forms lower lows, it may indicate that selling momentum is weakening.

From February 15th to March 8th, Ethereum price formed a low, but the RSI formed a slightly higher low, creating a typical bullish divergence.

Similar discrepancies previously appeared between February 15th and March 1st. After that signal flashed, Ethereum rallied more than 15% and rose to a local high near $2,199 ($2,200 zone) before losing momentum.

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The latest divergence has already generated a rebound of over 7%, raising the possibility that Ethereum will attempt another move towards the $2,200 area that provided resistance during the previous rally.

However, the data supporting the current move appears to be weaker than during previous rallies.

Currency flows and whale holdings show this recovery lacks previous support

One major difference lies in exchange flows and whale accumulation.

During the previous rally from March 1st to March 4th (post-break), Ethereum experienced continuous exchange outflows. The exchange’s net position change remains negative, indicating that coins are exiting the exchange, indicating continued buying pressure.

At the same time, the whale’s wallet also accumulated. Large wallet holdings increased from 113.43 million $ETH 113.51 million people on February 28th $ETH Approximately 80,000 people increased by March 3rd $ETHis gaining bullish momentum.

Ethereum Whale: Santiment

The current rebound shows the opposite pattern.

On March 9, the exchange’s net position change turned positive, with inflows reaching 146,709. $ETH. An increase in inflows usually indicates that investors are moving coins onto exchanges, increasing the likelihood of selling pressure. Encountering selling pressure immediately after a divergence is not good for upside expectations.

Rising selling pressure: Glassnode

The whales’ behavior has also changed. Large holders reduce supply from 113.7 million $ETH Approximately 113.61 million people on March 7th $ETH By March 10th, there will be a decrease of approximately 90,000 people. $ETH.

This combination suggests that the recent rally lacks the same accumulation support that fueled the previous 15% $ETH Soaring prices. But that’s not the only risk.

Cost-based data reveals large supply cluster between $2,030 and $2,180

On-chain cost-based data further highlights potential resistance going forward.

URPD (UTXO Realized Price Distribution metric) shows where the bulk of the supply last moved on the chain. These zones often act as support or resistance, as many holders may choose to sell when the price returns to its cost basis.

Note: URPD was originally designed for UTXO-based networks like Bitcoin, but analytics platforms like Glassnode have extended this metric to account-based chains like Ethereum.

Several notable supply clusters have emerged directly above Ethereum’s current price.

Approximately 1.42% of Ethereum’s supply is concentrated at around $2,029 (close to current price). Another 1.06% cluster appears around $2,079, followed by 0.88% around $2,128 and 0.91% around $2,178.

Main cluster 1: Glassnode

Together, these levels form a dense resistance corridor with more than 4% of supply located between approximately $2,030 and $2,180.

key $ETH Cluster 2: Glass Node

If holders in these zones start selling, the pullback could face significant resistance. And, as we saw earlier, the buying support is weak, so there is a possibility that the expected decline will not be absorbed.

Ethereum price needs to break above $2,200 to sustain upside expectations

From a technical perspective, Ethereum needs to clear $2,130 first, which closely aligns with the lower URPD supply cluster.

The next key barrier is near the psychological $2,200 level, which was previously the upper bound of the March rally. A decisive 8-hour close above $2,200 indicates that Ethereum has absorbed a nearby supply cluster, potentially paving the way to $2,270, which also has a sizable cluster.

This makes $2,270 a key resistance zone, and perhaps one that needs to be crossed to reignite hopes of a sustained rally.

key $ETH Cluster 3: Glass Node

However, downside risks still remain.

If Ethereum falls below $2,000, the pullback theory could weaken. A further decline towards $1,910 would strengthen the broader bearish structure.

For now, Ethereum’s latest rally appears to be technically valid, but weak on-chain support suggests the rally may face greater resistance than previous attempts.

The article “Ethereum rises 7% in familiar rebound cue, but on-chain data warns of significant risks” was first published on BeInCrypto.