Ethereum (ETH) Price Signals Rally to New ATH Above $5K Fueled by Rising Institutional Demand

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As a seasoned researcher with over two decades of experience in financial markets, I find myself thoroughly intrigued by the recent bullish momentum in the altcoin market, particularly Ethereum and Dogecoin. The past 24 hours have been quite exhilarating, to say the least, as I’ve watched Ethereum surge over 8 percent to trade at around $3,405.

The altcoin sector, with Ethereum (ETH) and Dogecoin (DOGE) leading the charge, has witnessed a strong bullish trend as a result of Bitcoin‘s recent entry into its price discovery phase. In just the last 24 hours, Ethereum’s price has climbed over 8%, currently trading around $3,405 during the mid-London session on November 12th. Meanwhile, Dogecoin also saw an increase, trading at approximately $0.40 with a 24-hour volatility of 39.4%. The market caps for Ethereum and Dogecoin stand at $404.82 billion and $60.17 billion respectively, while their 24-hour volumes amount to $72.66 billion and $36.08 billion each.

Consequently, the significant altcoin in the market, boasting a fully diluted value of approximately $410 billion and an average daily trading volume close to $70 billion, has managed to bounce back from the lower limit of an uptrend that commenced towards the end of last year.

For the first time in nine months, Ethereum’s daily Relative Strength Index (RSI) exceeded 70%, signaling a return of optimistic market sentiment. Additionally, Ether’s price has managed to maintain the 200-day Moving Average (MA) as a foundation following its bounce back from the 50 MA.

If Ethereum’s bullish trend continues over the short term, it’s reasonable to expect Ether’s price to climb towards its record high before 2021 ends. Additionally, there’s a growing preference among crypto investors for large-cap altcoins, as they anticipate an approaching ‘altcoin season’.

Major Factors Driving Ethereum Bulls

The desire for Ethereum to power the biggest Web3 infrastructure, with over $61 billion collectively locked and more than $91 billion in the stablecoin market, has noticeably increased as the general crypto market sentiment remains bullish. Institutional investors are increasingly placing wagers on an upcoming surge in Ether prices, having been stuck in a prolonged bearish phase for nearly eight months.

Based on recent market figures, BlackRock’s ETHA and other U.S. Ether ETF providers saw a record-breaking daily net investment of approximately $295 million on Monday. This is the largest inflow since the initial approval earlier this year. Over the past four days, these providers have collectively reported an overall cash influx of around $500 million, indicating a growing interest in Ether ETFs.

Over the last few days, increased turbulence in the price of Ether has led to over $200 million being withdrawn from the ETH margin trading market. It’s worth noting that a large number of traders who had bet on Ether falling in price (short sellers) have been forced out of their positions in the past two days, contributing to the ongoing crypto short squeeze.

Currently, the Ethereum market is adjusting to significant changes happening in key regions, leading to an enhancement in total cryptocurrency fluidity over time. For example, the U.S. Federal Reserve and the Bank of England made rate reductions on a recent Thursday, aiming to improve their economic forecasts.

Furthermore, it’s anticipated that the Chinese government will infuse as much as 1.4 trillion dollars in the short term, aiming to strengthen its economic perspective during the continued process of de-dollarization.

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2024-11-12 13:33