While Ethereum’s overall market structure remains under the influence of sellers, recent price movements indicate a potential waning of seller momentum, particularly after the market has tested the $1.5K support level on two occasions. The emergence of a potential double bottom, coupled with improving short-term momentum, suggests the possibility of a relief rally should buyers successfully reclaim the next resistance cluster. On the daily timeframe, ETH continues to trade within the established long-term descending channel that has persisted for months, with both long-term moving averages trending downward just above the upper boundary of the channel. The price remains significantly below the 100-day and 200-day moving averages, which are currently situated in the $2K to $2.2K range, indicating that the overarching trend continues to be bearish.
Following the significant sell-off observed a few weeks prior, the cryptocurrency demonstrated robust demand within the $1.5K support zone. The price has now tested this area twice, suggesting the potential for a double-bottom formation. Although the pattern remains unconfirmed, the consistent defence of this support indicates that bearish momentum may be diminishing. The RSI has also recovered from near-oversold conditions and is gradually pushing higher toward the midline, indicating improving momentum without reaching overbought territory. For the bullish scenario to gain credibility, ETH must reclaim the $1.8K resistance zone to validate the double bottom setup. A successful move above that level would also expose the next major supply area around $2,000 to $2,200, where the 100-day and 200-day moving averages converge. Conversely, losing the $1.5K support zone could likely prove catastrophic, as it would invalidate the potential reversal structure and likely trigger a deeper leg lower within the broader downtrend. The 4-hour chart offers a more distinct perspective on short-term trends.
The price has established liquidity below the $1.5K lows, as buyers re-entered the market, averting a lower low. This demand is progressively directing ETH towards the initial zone of upper supply. The price is currently nearing a significant fair value gap at around $1.7k. This imbalance coincides with the latest bearish impulse and is likely to attract selling interest. A decisive breakout above this zone would signal improving short-term strength and could open the path toward the $1.85K resistance. Momentum has shown significant improvement on the lower timeframe, as the RSI ascends toward bullish territory, concurrently establishing higher lows in alignment with price movements. This indicates that buyers have regained a measure of control following the recent rebound. However, unless ETH successfully clears the fair value gap and establishes higher highs, the current advance could still evolve into nothing more than a corrective rally within the broader bearish trend. The distribution of open interest in options contracts indicates that the most substantial concentration is centred around the late December 2026 expiry, where call open interest markedly exceeds put open interest. Several other major expiries, including late September and late July, also exhibit a distinct prevalence of call positioning.
This skew toward call options indicates that derivatives participants are still positioning for higher prices over the medium to long term, even in light of Ethereum’s recent weakness. Concurrently, the significant notional value concentrated around the larger expiries suggests that these dates may emerge as critical volatility catalysts as expiration nears. While options positioning alone does not guarantee a bullish outcome, the current distribution reflects a market that continues to uphold longer-term upside expectations, even as the spot price remains constrained beneath significant technical resistance. If ETH confirms the developing double-bottom structure and breaks above the nearby resistance cluster, the optimistic options positioning could provide additional tailwinds through improved market sentiment.