Ethereum Key Support in Jeopardy: Deeper Pullback Possible if Broken

Ethereum's recent price action resembles Bitcoin's, with both consolidating near key levels. However, there is a notable difference: Ethereum has slightly broken above the April and May highs, while Bitcoin remains capped by resistance below. This article examines Ethereum's current technical landscape from three angles—Elliott Wave structure, short-term support and resistance, and the ETH/BTC ratio—to provide traders with actionable insights.

Daily Structure: Uptrend Intact, Watch Pullback Nature

On the daily timeframe, the rally that began in June is likely not over. Two wave counts are currently in play:

• Blue count (bullish): If price completes a five-wave advance, it could form a leading diagonal as blue wave 1, with the subsequent pullback being wave 2, followed by another push higher.
• White count (neutral): The current advance may only be wave A, with another upward extension still possible.

Regardless of the count, the real test lies in whether bulls can defend the core support zone during the next deep pullback. So far, price has only seen a shallow correction, with the structure resembling a sideways consolidation—similar to the pattern after the July high, when price traded sideways for several weeks before breaking upward. Therefore, Ethereum could continue to consolidate for another 1–2 weeks before resuming its uptrend.

Key Support and Resistance

• Core support zone: $1,688 – $2,174. If a deep pullback begins, price should ideally hold this area to keep the broader bullish scenario intact.
• Short-term support: Around $2,415. A break below could open the door to lower support levels.
• Short-term resistance: $2,527. A breakout above this level would be an initial signal for the next leg up.
• Upside targets: If a new high is made, the next resistance sits at $2,751 (Fibonacci extension), followed by $3,165 (61.8% retracement).

Price is currently oscillating in a narrow range between $2,415 and $2,527. The increasing complexity of the micro-level structure is a common feature of fourth waves, which actually reinforces the view that the market has not topped and is still consolidating within wave four.

ETH/BTC Ratio: Watch the Trendline Break

On the 4-day chart, the ETH/BTC ratio has been trading in a wide range for an extended period. The ratio is now approaching the yellow trendline (around 0.035) once again—a trendline that has repeatedly capped rallies since 2022. A decisive break above it could signal that altcoins are starting to outperform Bitcoin, making it a key development to monitor.

In the short term, as long as ETH/BTC does not break below the June low of 0.025, further upside extension remains possible. Within the blue triangle pattern, an upward extension of wave D could also push the ratio to test the trendline.

Summary

Ethereum's daily chart remains in a consolidation phase within an ongoing uptrend. The core support zone of $1,688 – $2,174 serves as the bull/bear line in the sand. In the short term, watch for a breakout above $2,415 or $2,527. The ETH/BTC ratio is nearing a long-term trendline; a breakout could provide a signal for an altcoin rally. Traders should align with their own risk tolerance and wait for clear breakout or breakdown signals before making decisions.