Ethereum Faces Bearish Head and Shoulders Pattern as $2,500 Support Becomes Critical for Price Recovery
Ethereum (ETH) has shifted from a previously bullish outlook, where analysts expected a rally based on a Morningstar pattern and Wyckoff accumulation, to facing a bearish scenario marked by a classic Head and Shoulders formation on the 4-hour chart. After consolidating near $2,500, ETH broke below the key neckline at $2,480, touching lows of $2,380. Although a technical rebound is underway with ETH retesting the $2,500 level, analysts caution that failure to reclaim and sustain above this threshold would confirm the bearish setup and likely lead to declines toward the $2,200–$2,250 support zone, which aligns with a notable order block from May 9. Conversely, regaining $2,500 and breaking above $2,650 would invalidate the bearish structure, potentially setting up a move to the $2,700–$2,800 region. Overall, the short-term technical outlook has turned negative, with $2,200–$2,250 as a key watch area for traders. The change in narrative from bullish reversal to increased downside risk highlights the market’s sensitivity to support-resistance dynamics in cryptocurrency trading.
Bearish
Initially, Ethereum (ETH) showed signs of a bullish reversal, supported by strong chart patterns and analyst optimism about potential rallies. However, the emergence of a Head and Shoulders pattern on the 4-hour chart and ETH’s subsequent breakdown below the $2,480 neckline have shifted the short-term outlook to bearish. Technical analysis indicates that unless ETH quickly reclaims and holds above $2,500, further declines toward the critical $2,200–$2,250 support zone are likely. While a decisive break above resistance levels could lead to a bullish reversal, the current technical setup signals increased downside risk. This may prompt traders to exercise caution or position for possible further declines in the near term.