Ethereum Rebounds 4% as Reserves Fall and Resistance Looms

Ethereum ($ETH) has recovered more than 4% to approximately $2,462 following a drop toward $2,325, as traders examine whether declining exchange reserves can support another attempt to break above resistance levels between $2,500 and $2,550. According to CryptoNews, the recovery brought buyers back toward the $2,500 region after stronger-than-expected U.S. inflation figures triggered widespread selling across cryptocurrencies and technology stocks.

Exchange Reserves and Derivatives Data

CryptoQuant data cited in the report showed that Binance Ethereum reserves fell by 430,000 ETH between August 25 and October 16, moving from 3.90 million ETH down to 3.47 million ETH. At a reference price of $2,437.30, the difference was valued at approximately $1.05 billion. Concurrently, Binance Ethereum open interest declined 4.7% over 30 days to approximately $6.1 billion, while BitMine reported holding more than six million ETH, or roughly 4.9% of the circulating supply, in October.

The earlier market downturn triggered substantial liquidations among leveraged traders. Binance recorded its largest hourly Ethereum long liquidation in six months, wiping out approximately $106 million in leveraged long positions within one hour.

Technical Outlook and Resistance Levels

Analysts identified $2,500 as the primary resistance area, sitting just below the $2,550 threshold highlighted by analyst Ted Pillows. Technical indicators showed mixed signals following the bounce. The Moving Average Convergence Divergence indicator remained negative with the MACD line at -35.5, while the Relative Strength Index registered 41.93, staying below the neutral 50 level without entering oversold territory.

Key facts

• Ethereum gained approximately 4% over 24 hours, trading near $2,460 with a market capitalization of $300.6 billion.
• Binance Ethereum reserves fell by 430,000 ETH between August 25 and October 16.
• U.S. consumer prices rose 0.6% from August, driving annual inflation to 3.7% and sparking a liquidation event of $106 million in long positions.
• Analyst Ted Pillows identified $2,550 as a key resistance level following a bounce from the $2,350 support zone.