Ethereum (ETH) Price Aims for $5K Next after Successful Bullish Breakout Fueled by Whale Investors

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As a seasoned analyst with over a decade of experience in the cryptocurrency market, I must admit that witnessing Ethereum‘s current surge towards its all-time high is nothing short of exhilarating. My first encounter with Bitcoin and Ethereum was back in 2013, when $100 seemed like a fortune for a single coin. Now, here we are, talking about prices in the tens of thousands for both.

Bitcoin’s price has been surging towards a new all-time high (ATH) of over $106K, while Ethereum’s price is also on the rise. The volatility for both coins in the last 24 hours was relatively low at 2.0% for Bitcoin and 1.8% for Ethereum. Bitcoin has a market cap of approximately $2.07 trillion and a 24-hour trading volume of around $80.65 billion, while Ethereum boasts a market cap of $474.81 billion and a 24-hour trading volume of about $31.93 billion. This bullish trend suggests the beginning of a larger macro rally for these large-cap altcoins, as Bitcoin successfully retested its bullish breakout from a multi-year pennant consolidation.

Following two strong months of recovery, Ethereum’s price is now primed for a potential return to its record high of approximately $5K in the short term. On a daily scale, Ether’s value versus the U.S. dollar has recently revisited the larger-scale falling logarithmic trendline. For Ethereum to maintain its bullish momentum and potentially reach new heights shortly, it is essential that the resistance level around $3,950 becomes a reliable support level in the near future.

To further strengthen the bullish trend, the Relative Strength Index (RSI) needs to increase past the 70% mark. It’s also possible that Ethereum could experience a short-term correction, causing it to move within a mid-term downward trend towards the support level of approximately $3,580. After this potential correction, the bullish momentum is expected to resume.

Ethereum Whales Bet on Further Uptrend

Previously reported by Coinspeaker, there has been a substantial increase in Ethereum’s demand among large-scale investors, or “whales,” particularly following Bitcoin’s price surge to approximately $100k. Data from CoinGlass indicates that the Ethereum supply on centralized exchanges (CEXes) has decreased by over 177,000 units within the last month, currently sitting at around 15.6 million.

The significant drop in Ether’s presence on cryptocurrency exchanges can largely be attributed to an increase in demand from large-scale investors, particularly those involved with US spot Ethereum Exchange-Traded Funds (ETFs). As per data from Glassnode, the number of Ethereum wallets holding over 10,000 Ethers has seen a substantial rise during the past two months. This surge in institutional investment is driven by growing confidence in Ethereum’s continued dominance as a web3 pioneer, bolstered by its expanding utility and on-chain activities.

For example, investors with large amounts of capital, or “whales,” can passively generate earnings within the Ethereum network through the process of staking. This method is crucial for maintaining the project’s security. It’s worth noting that over 34 million Ether has been secured by more than 100,000 validators through this process.

Over the past three weeks, I’ve observed a significant surge in investment into U.S. spot Ether Exchange-Traded Funds (ETFs), with a net cash influx exceeding $2.1 billion. Last week alone, these funds recorded their highest weekly cash inflow of approximately $854.85 million, primarily driven by BlackRock’s ETHA. This influx suggests a growing interest in U.S. spot Ether among investors.

Bigger Picture

As a crypto investor, I can confidently say that Ethereum continues to dominate as a trailblazer in the Web3 realm, boasting a staggering $78 billion total value locked (TVL) and a impressive $110 billion market cap for stablecoins. In the past 24 hours alone, there have been over 428K active addresses on the Ethereum network, signaling its readiness to seamlessly facilitate mainstream adoption of digital assets and Web3 projects.

Personally speaking, I’m excited about the significant potential growth of the Ethereum ecosystem, particularly given the incoming Trump administration in the U.S., which is anticipated to provide substantial backing to the cryptocurrency industry.

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2024-12-16 13:24