Ethereum price rebounded toward $2,420 after a sharp sell-off, but weak capital flows and resistance near $2,465 leave ETH exposed to another correction.
Summary
- Ethereum price fell below $2,400 before recovering to about $2,421 during Tuesday’s session.
- The daily RSI dropped to 52.09 as momentum weakened from its recent overbought reading.
- 4-hour Supertrend resistance stands at $2,526, while Chaikin Money Flow remains negative.
- Analysts see downside toward $2,143 or lower if ETH loses its weekly support.
Ethereum price action today
Ethereum (ETH) price was trading near $2,421 on Sep. 16 after recovering from an intraday low of $2,382.70, according to Binance data shown on TradingView. ETH opened the current daily candle at $2,398.26 and rose about 0.95%, partially reversing the previous decline.
The rebound followed a broader sell-off that briefly pulled ETH below the $2,400 psychological level. Market pressure intensified after the Digital Asset Market CLARITY Act failed to advance in the U.S. Senate.
The bill’s cloture motion reportedly failed in a 49-50 vote, short of the 60 votes needed to proceed. Its defeat weakened expectations that Congress would soon establish clearer divisions between the Securities and Exchange Commission and the Commodity Futures Trading Commission.
Ethereum was particularly vulnerable because the pullback followed several failed attempts to remain above the $2,500 area. The token recently traded as high as roughly $2,660 before sellers pushed it back toward its current range.
Derivatives added to the pressure. Ethereum accounted for about $250 million in liquidations during the broader market decline, as the loss of $2,450 forced leveraged long positions to close.
Technical indicators point to fading momentum
Ethereum’s daily chart shows that the recovery remains below the Bollinger Bands’ middle line at $2,464.49. That level now forms the first technical barrier above the market.
The upper Bollinger Band sits at $2,544.69, placing the broader resistance zone between approximately $2,465 and $2,545. A daily close above that range would strengthen the case that the correction has ended.
ETH is also holding just above the lower Bollinger Band at $2,384.30. Buyers defended that level during Tuesday’s decline, with the session low reaching $2,382.70 before price recovered.
The daily relative strength index stands at 52.09. Although the reading remains above the neutral 50 mark, it has fallen below its moving average of 61.02 after retreating from overbought territory. The decline shows that bullish momentum has faded since ETH’s late-August rally.
Conditions look weaker on the 4-hour chart. Ethereum trades below Supertrend resistance at $2,526.61, while the indicator’s former support near $2,441.90 has been lost. ETH would need to reclaim both levels to weaken the short-term bearish setup.
Chaikin Money Flow stands at minus 0.07 on the same timeframe. The negative reading indicates that selling pressure is slightly stronger than buying pressure, limiting the conviction behind the latest rebound.
Ethereum must defend the $2,380 support zone
The immediate support area lies between $2,380 and $2,400. Both the daily lower Bollinger Band and Tuesday’s intraday low fall within this range, making it the first level buyers need to defend.
A sustained breakdown below $2,380 could expose the August breakout region near $2,300. The weekly chart shared by analyst Ted Pillows identifies another support zone around $2,230, with a lower level near $2,056 if selling accelerates.
The bullish path begins with a move back above the daily Bollinger midpoint at $2,464. ETH would then need to clear the psychological $2,500 level and 4-hour Supertrend resistance at $2,526.
Further gains could place the recent $2,550-$2,660 rejection zone back in focus. Acceptance above that supply area would invalidate much of the current bearish structure and open a possible move toward $2,800.
Ethereum’s one-week liquidation heatmap shows ETH trading near $2,420 after sweeping several leveraged positions during its drop from above $2,500. The closest liquidity is concentrated around $2,420-$2,450, while additional clusters appear near $2,500 and $2,625-$2,660. Below the market, liquidity is visible around $2,350-$2,400, leaving ETH vulnerable to further volatility if either side is breached.
Analysts warn of a deeper Ethereum correction
Crypto analyst Ted Pillows said ETH was testing its 50-week exponential moving average. He warned that a weekly close below the indicator could produce an 8% to 10% correction.
An 8% decline from approximately $2,420 would place Ethereum near $2,226, closely matching the first weekly support zone on his chart. A 10% pullback would take the token toward $2,178.
Crypto Patel offered a more bearish scenario after ETH was rejected from the $2,550-$2,660 resistance zone. The analyst identified $2,143, $2,000, and $1,870 as possible downside targets, with $1,800 as a deeper level to monitor.
Patel said the bearish scenario would remain active unless Ethereum reclaimed and held above $2,670. His longer-term outlook remains bullish, with targets between $10,000 and $15,000, although the forecast is speculative and depends on future market conditions.
US rate expectations and ETF outflows weigh on ETH
The CLARITY Act setback arrived as U.S. investors were already preparing for the Federal Reserve’s interest-rate decision. The probability of a 25-basis-point increase at about 80%, although the final decision will determine whether that expectation was justified.
Higher interest rates and Treasury yields can pressure crypto assets by increasing the return available from lower-risk instruments. Ethereum could therefore remain sensitive to changes in Fed expectations even if its technical support holds.
U.S. spot Ethereum exchange-traded funds also recorded approximately $141.5 million to $142.3 million in net outflows during the reported session. BlackRock’s ETHA accounted for about $98 million, while Bitwise’s ETHW recorded around $34.4 million in withdrawals.
Roughly 140,000 ETH, valued at about $350 million, was reportedly withdrawn from exchanges over recent days. Lower exchange balances may reduce immediately available selling supply, but the daily and 4-hour charts show that ETH must reclaim $2,465-$2,526 before buyers regain firm control.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
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