Ethereum (ETH) is once again navigating choppy waters as its price stalls beneath the $2,500 threshold. Market participants remain cautiously optimistic, with eyes set on both technical support levels and macroeconomic catalysts. Yet as liquidations rise and derivatives data cools, one question dominates the discussion: can Ethereum’s $2,300 support level hold under pressure?
As of May 20, Ethereum’s price has dropped to around $2,482—down about 1.8% from its recent weekly high of $2,588. This decline aligns with a broader lull in the crypto market, with only a few altcoins like Solana (SOL) and Tron (TRX) showing modest gains of 1.7% and 2.3%, respectively. Overall, the market is in a wait-and-see mode, ahead of the Federal Reserve’s next move in June and pending SEC decisions on multiple altcoin ETF proposals set for June 16.
Technical Signals: Warning Signs or Healthy Cooldown?
Ethereum’s price action has clearly lost some momentum. On the daily chart, the Parabolic SAR—a key trend-following indicator—sits at $2,722, far above current prices. This suggests the short-term trend has flipped bearish, with ETH now forming lower highs over consecutive sessions. That kind of chart pattern doesn’t typically instill confidence in bulls, especially when paired with weakening volume.
The Relative Confidence Index (RCI) ribbon adds further context. Short-term RCI has plunged to -36.97, while the medium and long-term indicators remain elevated at 87.72 and 74.41, respectively. This divergence indicates growing short-term skepticism even though broader momentum remains intact—for now.
One level that traders are watching with laser focus is $2,300. This isn’t just an arbitrary number—it’s backed by volume node analysis and historical price consolidation in that region. In short, it’s a psychological battleground. A failure to hold this line could open the floodgates, with $2,100 being the next major support area on the radar.
Derivatives Data: Optimism With a Side of Risk
In the derivatives market, sentiment remains mixed. Open interest across ETH futures climbed slightly by 1.72%, reaching approximately $30.94 billion. However, that was overshadowed by a sharp 34.79% drop in trading volume, which fell to $89 billion. Options trading mirrored this pattern: open interest held steady at $7.69 billion, but volume declined 32.62%. These numbers suggest traders are hesitant to make big directional bets—at least until they get more clarity on macro trends and upcoming regulatory moves.
Digging deeper, Binance’s long/short ratio sits at a neutral 0.9849. But that doesn’t tell the whole story. Among top traders, the bias is strongly bullish. Account-based data shows a 2.77x long-to-short ratio, while position-based analysis reveals a similar 2.68x skew. That level of leverage can be dangerous. If sentiment sours, heavily long traders could trigger a cascade of liquidations, putting further downward pressure on ETH’s price.
Liquidation Watch: A Fragile Balancing Act
In the last 24 hours alone, Ethereum derivatives saw over $64 million in liquidations. Of that, $35.46 million came from long positions, while shorts accounted for $28.90 million. The latest 1-hour liquidation total clocked in at $1.54 million—with nearly 28% coming from longs. These figures highlight just how vulnerable traders are in this sideways market.
Even more telling: $22.35 million in long liquidations occurred in just the past 12 hours. This is a red flag that leveraged longs are starting to crack under the weight of uncertainty. If Ethereum breaks below $2,300, that fragility could morph into a sharp selloff.
The Bottom Line
Ethereum’s long-term momentum still shows signs of life, but short-term sentiment is clearly wobbling. With the $2,300 support zone now in the spotlight, traders would be wise to tread carefully. A break below could not only invalidate the May uptrend but also unleash a wave of liquidations that sends ETH spiraling toward $2,100.
The next few days could be pivotal—especially as global economic signals and regulatory updates begin to surface. For Ethereum holders, patience and risk management will be essential tools in navigating the current volatility.
