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Ethereum Price Analysis: ETH Surges Past $4,000 — Is a New ATH Incoming?
In recent times, Ethereum (ETH) has witnessed a remarkable surge, as it breaks the psychological barrier of $4,000. This sudden shift in momentum is driven by institutional and ETF inflows, further amplified by technical breakouts. As a result, traders are now looking forward to deciphering whether this rally will set a new all-time high.
Institutional Demand and ETF Inflows Fuel Momentum
One of the primary drivers behind Ethereum’s remarkable surge is the influx of institutional capital via Ethereum Exchange-Traded Funds (ETFs). Since July, ETFs have seen net inflows of approximately $1.99 billion, with BlackRock’s ETHA ETF alone raking in a staggering $727 million in a single day. This sudden shift towards long-term holding sentiment is also reflected by the 12.3 million ETH reserves on centralized exchanges dropping to levels not seen since 2018. Concurrently, corporate treasuries have shown increased interest in Ethereum, with small publicly traded companies now holding nearly one million ETH (valued at approximately $3.5 billion), a massive increase from the end of 2024.
Short Squeeze Contributes to the Rally
A significant short squeeze has also contributed to the recent price acceleration as Ethereum surged towards $4,200. As the cryptocurrency rose, over $183 million in short positions were liquidated, compelling many bearish traders to cover their positions and further amplify buying pressure.
Technical Breakout Signals a Long-Term Target in $6,000-$6,200 Range
Ethereum has now broken above a multi-year ascending triangle that started forming in 2021. This chart pattern’s height (~$1600) projects a long-term target within the $6000-$6200 range if momentum is sustained. The cryptocurrency is currently testing $4,425 as an intermediate resistance and $4820, which marks the all-time high.
Decisive Weekly Close above $4,820
A decisive weekly close above this level could set off a rapid rally towards $5500 with $6000 in sight if buying pressure remains robust. The former breakout zone around $4000-$4050 is now critical support. Any healthy pullback that stays above this region may serve as a springboard for another leg up to $4,425 and then the all-time high.
Weekly RSI Sits at 69.6
Currently, the weekly RSI is situated at 69.6, indicating intense bullish momentum but nearing overbought territory. As ETH price approaches this level (75-80), it could be met with another sharp move towards $5500+. However, traders should watch for early signs of bearish divergence to prevent any sudden correction.
Long-Term Trend Supported by Rising Trendline
In the event that Ethereum fails to hold above $4,000, a pullback towards $3,800 is possible before attempting an upside breakout. As long as ETH trades above this trendline (from 2020 near $3200), the broader uptrend remains intact and supports the potential for a $6000+ goal in the coming cycle.
Disclaimer: This analysis should not be considered investment advice.
Source: coinpedia.org
