Ethereum Dead Cat Bounce in Play? Here's What Chart Says

Ethereum ($ETH) has jumped by 9.19% in the last seven days as the asset maintained stability above the $4,000 level. This uptick has sparked bullish sentiment in the Ethereum community as investors anticipate an upsurge toward $5,000.

Analyst warns of "Dead Cat Bounce" in Ethereum

However, MikybullCrypto, a crypto trader on X, maintains that an Ethereum "dead cat bounce" that could trap bulls is at play. For clarity, a dead cat bounce refers to a brief recovery period for an asset when the price goes up a little, after a huge decline. Notably, the asset reverses the uptick and continues its previous downward trend.

MikybullCrypto is suggesting that the current upward movement in price might be short-lived and entrap investors who are bullish on the asset. He maintained that any investor who buys $ETH now, anticipating a further price surge, could suffer losses when it falls quickly.

The analyst, relying on a TradingView chart, highlighted that Ethereum has been on a descending path since July 2025, when the price hovered around $3,500. He is using this as a baseline price for Ethereum, insisting a massive dump could see the coin drop from its current levels.

As of press time, Ethereum is changing hands at $4,389.30, which represents a 5.42% increase in the last 24 hours. $ETH had earlier traded at a peak of $4,423.12 before slipping as a result of market volatility. There has been a surge in trading volume by up to 40.32% to $51.34 billion within the same time frame.

The market outlook suggests a solid recovery for Ethereum. Hence, members of the community are reacting to MikybullCrypto’s analysis with skepticism. A user stated that the current setup looks like a bear trap, not a bull trap, implying that Ethereum is likely to continue its upward momentum.

Ethereum outlook, bull trap or bear trap?

Interestingly, Ethereum whales, within this period, have intensified their accumulation move.

When the price fell below the critical $4,000 level, these large holders received 431,018 $ETH, valued at over $1.73 billion from different exchanges. This was considered a bullish move as the direction of flow moved from exchanges to wallet signal stacking.

However, less than 48 hours ago, an unknown wallet transferred 198,289 $ETH worth about $852 million to a crypto futures exchange. Coming at a time of price rebound, some market watchers are treating it as an attempt to sell, although it was not specified.

With Ethereum receiving mixed predictions from analysts, the price outlook will become clearer with time.