Ethereum’s 11% Rebound: Real Recovery or a Market Trap?

Ethereum has made a noticeable comeback, with an 11% price jump over the past week. This sudden surge has sparked both excitement and skepticism across the crypto community. Is this the start of a bullish reversal, or are investors being lured into a classic bull trap?

Let’s break down what’s really happening on the charts and in investor minds.

Accumulation or Just Hype?

Ethereum’s price bounced from around $1,412 to $1,567, a rally that has caught the attention of analysts and traders alike. What’s fueling this? On-chain data reveals that investors have been actively accumulating ETH, especially around the $1,460–$1,470 zone. Over 380,000 ETH was bought in this region, and within just five days, another 453,000 ETH followed. That’s serious buying power.

Such accumulation typically signals investor confidence, the kind we see at the start of new bullish trends. But the real question is: who’s doing the buying? If this demand comes mainly from the spot market, it suggests long-term belief in ETH’s growth. On the other hand, if leveraged traders are behind it, things could get dicey. In risk-off environments, leveraged positions can easily unwind and send prices tumbling just as fast as they rose.

Greed Is Creeping Back In

The Fear and Greed Index for Ethereum has shifted toward “greed,” currently sitting at 55. That’s a big psychological swing compared to recent weeks when fear dominated sentiment. It means that investors are beginning to feel optimistic again, perhaps even a little too eager to believe the worst is over.

But a single indicator doesn’t paint the whole picture. Ethereum’s Net Unrealized Profit/Loss (NUPL) metric, which tracks the ratio of investors sitting on unrealized gains, is still deep in the “capitulation” zone. This suggests that despite the price rebound, most holders remain underwater, potentially ready to sell at the first sign of weakness.

So while there’s definitely some bullish buzz in the air, there’s also plenty of caution lurking under the surface.

Mixed Signals From Exchange Activity

Exchange data offers more clues. Around 100,000 ETH flowed into spot exchanges last week, which usually points to potential sell pressure. Investors may be looking to cash out if they believe this rally won’t last.

In contrast, 60,000 ETH exited the derivatives market, likely signaling growing interest in long positions. Funding rates are also trending positive, reinforcing the idea that more traders are betting on Ethereum’s continued rise. But that comes with its own risk,  if the spot market doesn’t back up that optimism, a sharp pullback could catch long traders off-guard.

Proceed With Caution

All in all, Ethereum’s 11% rebound is a welcome change from the bearish stretch that dominated early 2025. However, it’s still too early to declare a full-on market recovery. The mix of optimism and underlying uncertainty suggests the market is at a crossroads.

Whether this is a true turning point or just a temporary bounce depends on how investors, especially in the spot market, respond in the coming days.

For now, the message is clear: be hopeful, but stay cautious.