The price of Ethereum has increased by 5% in the last 24 hours, aligning with the general market recovery trend. Ethereum, a top altcoin, is currently trading above the psychological level of $2,500, boosting short-term positive sentiment.

Nonetheless, technical analysis and on-chain indicators are suggesting a potential slowdown in the upward momentum.

ETH's Technical Analysis Turns Negative

An evaluation of the ETH/USD daily chart indicates a possible formation of a death cross on its Moving Average Convergence Divergence (MACD) indicator.

A death cross occurs when an asset’s MACD line (blue) crosses below the signal line (orange), indicating a shift from bullish to bearish momentum. This pattern typically precedes substantial price declines, particularly when combined with weakening bullish sentiment.

Presently, ETH's MACD line is on the brink of dropping below its signal line. If this occurs, the death cross would validate the increasing selling pressure, pointing towards a prolonged downward trend.

Moreover, the Taker Buy-Sell Ratio for ETH is below 1 currently, indicating a dominant selling influence in its futures market.

The Taker Buy-Sell Ratio assesses the ratio between buy and sell volumes in ETH futures trading. Values above 1 suggest aggressive buying of ETH contracts, while values below 1 signify prevailing sell pressure.

The persistence of taker-sell volume suggests that despite the price rise, the fundamental demand in the ETH market remains weak.

Potential for ETH Price Decline as Sellers Target $2,027

ETH is currently trading at $2,528, but with diminishing buying pressure, the altcoin faces the risk of dropping towards the $2,424 support level.

If bearish momentum strengthens at this point, ETH sellers may break the support level, leading to further declines towards $2,027.

However, if bullish sentiment returns and demand for ETH surges, the price could rebound and climb to $2,745.