Ethereum has now failed for five straight days to close above its key TBO resistance level of 23.76, leaving traders questioning whether a breakout is truly on the horizon. This repeated rejection at resistance has shifted market attention to the possibility of a pullback, with technical analyst MooninPapa identifying the Fast line near 22.26 as a more likely destination in the short term than any clear upside breakout.
Market signals raise doubts over rally strength
Bitcoin posted another green daily close on Thursday, often seen as a sign of market confidence. Yet despite this performance, the daily RSI for BTC moved into overbought territory at 70.76 while forming lower highs compared to previous peaks in April and March. MooninPapa pointed out this bearish divergence, describing it as a structural warning sign even as price action temporarily looked positive with a recovery from Thursday’s low at $73,309.
According to MooninPapa, both ETH and BTC now show symptoms of weakness beneath the surface. Price appears supported artificially rather than naturally strong, and the absence of a clear bearish reversal signal on short-term ETH charts adds to the uncertainty. Instead of a clean setup, the structure continues to tip sideways or lower.
Compounding concerns, Thursday saw a dramatic drop in both BTC dominance and stablecoin dominance. Typically, this backdrop would encourage risk-on sentiment, but this time it coincided with sharp surges in major altcoins, raising fresh questions about the rally’s foundation.
Suspicious moves in altcoins spark caution
Asset flows rotated quickly into altcoins as market cap indices like OTHERS, TOTALE50, and TOTALE100 all pushed higher in a single session. While this broad-based rally seemed bullish on paper, MooninPapa categorized it as either rotation, short squeeze dynamics, or exit-pump behavior—rather than sustainable trend continuation.
MooninPapa highlighted a specific watchlist of altcoins that surged into resistance, including XRP, BNB, SOL, LINK, SUI, ENA, LDO, INJ, and FIL among others. Every name on this list recorded notable gains but now sits in a vulnerable position should momentum reverse. This was not offered as a buy signal; instead, it was flagged as a warning for potential steep retracements if the broader move ends abruptly.
MooninPapa is an active technical analyst known for in-depth chart analysis on X (formerly Twitter), where followers regularly track his market calls and insights regarding both digital assets and macro trends.
Macro landscape adds pressure
Traditional markets did little to provide comfort. The U.S. Dollar Index (DXY) confirmed a pivot low and appeared set to rebound, putting further strain on USDJPY. Macroeconomic conditions have remained unfavourable for sustained risk appetite, even as S&P 500 futures hit all-time highs and the Nikkei index continued to climb. Meanwhile, Tesla rallied, but trading volume has faded throughout this uptrend, featuring another sign of fragility in global markets.
In commodities, oil maintained an upside gap, gold traded sideways within its current range, and uranium broke out of a bullish structure. None of these indicators suggest a clear risk-on backdrop; instead, they collectively point toward choppy and uncertain market conditions.
Macro signals continue to reflect the conflicting environment seen in recent weeks, where stablecoin dominance previously increased and TOTALES broke below a critical support. These underlying flows remain unresolved, underpinning short-term caution among attentive traders.
Summing up the current environment, MooninPapa warned market action is “moving in a very weird way.” For him, the priority in such choppy conditions is to respect the prevailing macro trend and avoid chasing suspicious pumps, as both BTC and ETH face tough barriers and any rally in altcoins may quickly reverse.
MooninPapa emphasized that at this stage, the resistance above BTC remains strong while support is fragile—for ETH, five days of consecutive failure at resistance sets the tone for a more cautious outlook overall.
