Ethereum has recovered on the charts, but the data underneath tells a different story.

Ethereum has recorded a gradual price recovery, but this movement lacks the fundamental strength needed to sustain the price. Especially from an investor’s perspective, market conditions continue to worsen rather than improve.

The risk of a correction is high as the underlying sentiment is not in line with the surface level price appreciation we are currently seeing. $ETHchart.

Ethereum holders are losing confidence

Despite Ethereum’s recent price rally, realized P&L data tells a sobering story. For the past 2 months $ETH The holder only experienced a realized profit for one day, but quickly returned to losses. This near-total absence of profitable exits reflects the fact that holder-based positions are overwhelmingly underwater.

Investors who sell at a loss are exhibiting typical panic behavior rather than strategic repositioning. This continued realization of losses creates a negative feedback loop in which selling pressure remains elevated despite short-term price increases. The bearish mood created by two months of sustained losses will continue to weigh on Ethereum’s recovery trajectory until holders meaningfully return to profitability.

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Ethereum realized profit and loss. Source: Glassnode

The number of new address creations on the Ethereum network decreased by 16% to 231,867, the lowest level in nearly three months. This decline indicates that potential new investors are exiting the market rather than entering it. Consistent losses experienced by existing holders appear to discourage new participation, as new entrants are reluctant to purchase assets that consistently experience losses.

The decrease in the growth of new addresses directly impacts the flow of new funds into Ethereum. New addresses represent demand from first-time buyers, and the absence of new addresses removes an important source of increased purchasing pressure. Without this new capital injection, Ethereum’s ability to sustain price appreciation above key resistance levels will increasingly depend on existing holders changing their behavior, a development that is unlikely in the short term.

$ETH Pricing to lose key support

Ethereum is trading at $2,189 after losing its 50-day exponential moving average as structural support and is above the $2,158 support level. The loss of EMA support is a technically important development and confirms a deterioration in the short-term trend. This structural weakness makes the $2,158 floor a meaningful last line of defense before a more severe decline.

If selling pressure from underground investors continues, a breakout of the support at $2,158 is possible, and Ethereum could fall towards $1,917. Whether this scenario materializes depends on whether holders choose to continue their panic selling or stabilize their behavior at current levels. A sustained sell-off below $2,158 will confirm that the recovery attempt has failed.

If the price rebounds from $2,158 and successfully converts the resistance at $2,348 into support, the outlook will change significantly. This structural change will push Ethereum towards $2,500, invalidating the current bearish theory. As the CBD heatmap shows, Ethereum does not have a major supply wall up to $2,850 and has plenty of room to move higher.

The article “Ethereum rallied on the charts, but the data underneath tells a different story” originally appeared on BeInCrypto.