Ethereum (ETH) Price: All Eyes on May 7 as Upgrade Could Break the Downward Spiral
TLDR
Ethereum price has fallen below $1,800 and the 100-hourly Simple Moving Average
A bearish trend line is forming with resistance at $1,830 on hourly charts
The upcoming Pectra upgrade on May 7 brings validator scaling and cheaper L2 fees
Coinbase will pause ETH deposits/withdrawals during the upgrade window
Technical analysis shows ETH could drop further if it breaks the $1,785 support level
Ethereum’s price has entered a downside correction phase, falling below key support levels at $1,850 and $1,820. The second-largest cryptocurrency by market cap is now trading below $1,800 and the 100-hourly Simple Moving Average, indicating bearish sentiment in the short term.
The price action shows ETH failed to clear the $1,880 resistance level and started moving downward. This decline pushed the price below the 50% Fibonacci retracement level of the recent upward move from $1,734 to $1,872.
Bears have managed to push the price below the $1,800 psychological level, though ETH found support near $1,785. A key bearish trend line is forming with resistance at $1,830 on the hourly chart of ETH/USD.
On the upside, Ethereum faces hurdles near $1,820 with the next key resistance at $1,830 and the trend line. If the price manages to break above $1,880, it could potentially move toward $1,920 or even test the $2,000 level.
Technical Analysis Points to Potential Further Decline
If Ethereum fails to overcome the $1,830 resistance, it could start a fresh decline. The initial support is near $1,785 and the 61.8% Fibonacci retracement level of the upward move from $1,734 to $1,872.
The first major support sits near the $1,750 zone. A clear move below this level might push the price toward $1,720. Any further losses could send ETH to the $1,685 level, with the next key support at $1,640.
The 4-hour price chart shows a sideways movement above the $1,755 mark, which represents a high-demand area extending between $1,754 and $1,765. This zone has provided multiple bouncebacks, helping to maintain Ethereum’s uptrend alongside the 200 EMA line.
The current sideways movement marks a consolidation range with an upper ceiling near $1,855. While the ETH price holds above $1,800 after a prevailing recovery, the 100 and 200 EMA lines appear close to giving a positive crossover.
However, the RSI indicator reflects a loss of momentum as the consolidation range expands. Currently, the 4-hour RSI line struggles to overcome the halfway line.
Based on Fibonacci levels, a bullish breakout above the upper ceiling at $1,855 would likely test the 78.60% Fibonacci level near $1,949, with potential to reach the $2,100 mark near the previous swing high.
Pectra Upgrade Could Be a Catalyst for Price Movement
The upcoming Pectra upgrade scheduled for May 7 might serve as a potential catalyst for Ethereum’s price. This upgrade brings several key refinements to the Ethereum mainnet, including validator consolidation, reaching a 2,048 ETH market cap from the previous 32 ETH limit.
Layer 2 solutions could become cheaper as blobs per block grow by 100% from 3 blobs to 6 blobs. Additionally, EIP-7702 will bring temporary smart contract functionality to Ethereum wallets.
The key improvements include faster staking, lower Layer 2 transaction fees, and smarter wallets. These upgrades will bring higher yields for stakers with easier operation.
Roll-ups like Optimism and ZK-Sync will benefit from cheaper data posting with the increase in blobs per block. Decentralized applications on the Ethereum ecosystem will be able to process batch transactions as gas sponsorships become easier.
Despite these positive changes, there are potential risks involved in the Pectra upgrade. The validator consolidation could increase the risk of centralization on the Ethereum mainnet, and the reliance of dApps on call data could increase transaction costs.
In preparation for the upgrade, Coinbase has announced a temporary pause of Ethereum deposits and withdrawals. This pause will extend from 2:50 am to 3:45 am PT on May 7 to ensure the safety of users’ funds.
The initiation of new staking requests during this cool-off period will be delayed until 3:45 am PT, though existing stake positions will not be impacted.
On-Chain Data Shows Mixed Signals
On-chain data from IntotheBlock shows a strong resistance ahead for Ethereum. The initial supply zone extends from $1,805 to $1,857, holding a total volume of 5.85 million ETH across 4.48 million addresses.
This supply zone is much larger compared to the nearest demand zone, which extends from $1,748 to $1,800 and holds a total volume of 2.29 million ETH within 3.46 million addresses.
However, if Ethereum’s price manages to push above the overhead supply zone, it could see a smoother path toward the $2,000 mark due to the short-term supply zones ahead holding a lesser supply.
As Ethereum hangs close to crucial support, the spot volume is on a cooldown stage. According to on-chain analyst DarkFost, this sudden slowdown in Ethereum spot volume could actually be a positive signal for a potential bullish recovery.
$ETH spot volume is cooling off 🫠 and that might actually be a good sign.
This chart highlights two interesting metrics :
🔹 Spot volume is shown as bubbles, the bigger the bubble, the higher the volume.
🔹The rate of volume change is represented by the color of each bubble.… pic.twitter.com/XpHSqCYd2M
— Darkfost (@Darkfost_Coc) May 5, 2025
The Ethereum spot volume bubble map shows a sudden drop in volume, which aligns with the prevailing correction in price. This volume decline as the asset price falls could help reduce volatility and potentially reflects a slowdown in selling pressure.
The post Ethereum (ETH) Price: All Eyes on May 7 as Upgrade Could Break the Downward Spiral appeared first on CoinCentral.
Filed under: News - @ May 6, 2025 8:28 am