Ethereum's price has seen a notable 10% increase over the past week, pushing the altcoin above the $2,344 support level.
Despite this rise, ETH is unlikely to break through the critical resistance at $2,681. The Price Daily Active Addresses (DAA) Divergence indicator is currently flashing a sell signal, suggesting that Ethereum's recent rally may soon face a pullback.
This signal typically occurs when participation declines during a price rise, indicating waning confidence among investors. Declining participation highlights a lack of strong buying interest, making the price rally more susceptible to downward pressure.
Additionally, the overall macro momentum for Ethereum supports the likelihood of a price correction. The realized profits metric further confirms the sell signal, as investors have sold nearly $40 million worth of ETH over the last two days.
This surge in realized profits indicates that some investors are cashing out to capitalize on the recent price increase, reflecting a loss of confidence in Ethereum's ability to maintain its upward momentum.
Based on current indicators, Ethereum could face a drop to the next crucial support level at $2,344. If ETH falls below this level, a further decline toward $2,170 may follow.
However, if Ethereum manages to withstand the selling pressure and breach the $2,681 resistance barrier, it could continue its rise toward $3,000, invalidating the current bearish outlook.
