Bullish Sign Or Bear Trap?
Ethereum is on the verge of regaining $4,000 levels, getting closer to all-time highs. The second-largest cryptocurrency by market capitalization has faced skepticism throughout the cycle, with some analysts predicting it would underperform compared to previous bull runs. However, despite the uncertainty in the market, Ethereum has surprised the doubters with its performance, climbing steadily higher in recent weeks.
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Glassnode’s key on-chain indicator reveals an important trend that could drive further price gains: Ethereum whales have been actively accumulating since late November. This signals growing confidence among major holders who are preparing for a potential rally. Historically, whale accumulations have often preceded large price moves, suggesting the possibility of a near-term breakout.
Although the market still exists Ethereum’s trajectory splitsIts ability to maintain its upward momentum near the $4,000 mark will likely determine its performance in the coming weeks. A break above this key resistance level could open the door to new highs and further solidify ETH’s role as the leader of the current bull cycle.
Ethereum whale balance grows
Ethereum has experienced a steady, albeit modest, rise since November 5, but the real fireworks for ETH appear to have yet to ignite. As Bitcoin prices soar and several altcoins outperform expectations, Ethereum investors are looking for clear signs that a bull run in the second-largest cryptocurrency is coming.
Top-level shared key chain data X Analyst Ali Martinez Provides interesting insights into the current state of Ethereum. Martinez highlighted that Ethereum whales (entities holding large amounts of ETH) have been actively accumulating since the price broke through the $3,330 level.
This accumulation trend suggests that smart money is positioning itself for a potential sharp rise in the coming months. Historically, the accumulation of whales has often been a precursor to strong price increases, as these large investors tend to predict major changes in the market before retail traders do.
However, this statement is not entirely optimistic. While the accumulation of whales may signal confidence, it also raises concerns about a potential bull trap. If market conditions change or Bitcoin dominance stifles altcoin growth, these large holders may quickly pivot and move their ETH to other assets. The move could catch smaller investors off guard, leading to a sharp correction.
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For Ethereum, staying above key levels such as $3,800 while breaking through key resistance levels could be the catalyst needed to spark a true bull run. Until then, Ethereum remains the most popular on the watch list, balancing potential and uncertainty.
Price tests key resistance
Ethereum (ETH) is trading at $3,950 and has been struggling to break above the key resistance at $4,000 for several days. Nonetheless, prices remain resilient, indicating strong market support. Clearing this level is crucial to confirm the continuation of the uptrend, as $4,000 represents a psychological barrier and key resistance zone for the asset.
If Ethereum fails to break above the $4,000 mark, a retracement to the low demand area around $3,500 is expected. This level has acted as strong support in recent weeks, providing a buffer during periods of increased selling pressure. A pullback into this area could bring fresh buying momentum, setting the stage for another attempt to break higher.
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However, recent market dynamics suggest that Ethereum may be poised for a significant surge. The surge in Bitcoin price discovery and growing optimism about altcoins have created a bullish environment. As whales continue to accumulate ETH, market participants are increasingly confident in Ethereum’s ability to retest and surpass its all-time highs, as highlighted by on-chain data.
Featured image from Dall-E, chart from TradingView
