Ethereum (ETH) stabilized near the $4,000 mark as buyers struggled to build momentum and break through resistance.
Despite recent poor performance and a sharp pullback earlier this week, some analysts predict that ETH could surge to $5,000 due to growing institutional demand.
Ethereum (ETH) Price Action: A Review
Ethereum (ETH) has struggled to break above $4,000 as it faces considerable resistance and buyers are held back by selling activity at higher levels. ETH has been bullish since the US election, with demand increasing significantly as the market surged following Donald Trump’s victory. ETH’s bull run peaked last week, hitting an intraday high of $4,093 before closing at $4,003, its highest level since March 2024. However, sentiment weakened over the weekend as the price dropped slightly on Saturday and dropped to $3,999. ETH rose slightly on Sunday, regaining $4,000 to close at $4,007.
source: trading view
However, the market collapsed on Monday with a sudden pullback. As a result, ETH plunged more than 7% to an intraday low of $3,536 before recovering to recover $3,700 to close at $3,715. On Tuesday, sellers retained control and the price fell more than 2%, hitting a low of $3,521 before closing at $3,630. On Wednesday, sellers attempted to push ETH below $3,500 as it fell to an intraday low of $3,558. However, as sentiment changed, it recovered from that level, rising nearly 6% to end the day at $3,834. On Thursday, ETH attempted to break above $4,000, hitting an intraday high of $3,988. However, it lost momentum after reaching this level and ended the day up 1.26% at $3,882.
On Friday, buyers retained control and ETH edged higher to $3,907. ETH is trading slightly higher during the current trading session as buyers seek to build momentum and move towards $4,000.
What’s next for Ethereum (ETH)?
So, where will Ethereum (ETH) go from here? ETH faces considerable resistance at $4,000 but has so far been unable to conquer this level. Despite its recent underperformance, analysts believe ETH can break above $4,000 and even reach $5,000 as institutional demand for the asset grows. Looking at the price chart, we see that ETH has support around $3,700. If sellers break this level, ETH could drop to $3,500. On the other hand, if buyers retain control and build enough momentum, a price break above $4,000 is a realistic scenario.
Analysts support the latter scenario, with some predicting an unprecedented surge above $5,000. This prediction is supported by a significant increase in on-chain activity and a significant increase in inflows into new Ethereum ETFs. As ETH emerges as a viable alternative to Bitcoin (BTC), Ethereum funds reported $1.2 billion in investor inflows. According to CryptoQuant, a return to investor demand could push the price of ETH well above $5,000.
“Based on valuation metrics, ETH could break above $5,000 if current demand and supply dynamics persist.”
CryptoQuant has also noticed a surge in on-chain activity, with daily transaction volumes hovering between 6.5 million and 7.5 million this year, compared to around 5 million daily transactions the previous year.
“Higher network activity on Ethereum means increased usage and demand for network features, reflecting the growing adoption of decentralized applications.”
Disclaimer: This article is for informational purposes only. It is not provided or intended to be used as legal, tax, investment, financial or other advice.
