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Ethereum (ETH) saw a significant rally of 4.7% over the past 24 hours, reclaiming a crucial support zone. This performance has fueled bullish sentiment among some market observers, who see the cryptocurrency surpassing a key resistance level in the coming days.
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Ethereum Reclaims Key Support
Nearly a week ago, Ethereum surged above $4,000 for the first time in nine months, closing in on its March high and the long-awaited resistance level of $4,100. However, the cryptocurrency rally was temporarily halted after the cryptocurrency market saw a significant pullback.
Earlier this week, ETH retraced almost 10%, falling below $3,500 as Bitcoin returned to $95,000. After the retracement, the second-largest crypto by market cap steadily moved back up, reclaiming the $3,800 support zone on Wednesday afternoon.
The ETH price then rose another 2% in the early hours of Thursday to trade above the $3,900 level again. As Ethereum reclaimed this key area, Crypto analyst Carl Runefelt noted that the cryptocurrency was moving back above its ascending support trendline, which it lost during the market correction.
Additionally, the king of Altcoins was retesting a six-day downtrend line in the 4-hour chart, which would target an upside towards $4,000 after a successful breakout of the $3,940 mark.
Ethereum broke through this resistance in the following hours, reaching a daily high of $3,985 before falling back to $3,945. According to the analyst, staying above this level could propel the ETH price to $4,100 in the coming days.
ETH at $5,000 soon?
According to some analysts, despite reclaiming the $3,900 zone, Ethereum has yet to successfully turn another multi-year resistance into support. Analyst Alex Clay recently highlighted that ETH has been retesting the $9,350 level since 2021, without success turning it into support over the past few years.
Ethereum has been rejected at this resistance level four times. However, when ETH broke and held this level, it reached its all-time high (ATH) of $4,878 around three years ago.
Crypto analyst Jelle suggested that Ethereum is bracing for massive moves as it recently broke out of a multi-year pennant. ETH-based exchange-traded funds (ETFs) have seen a massive surge since the post-election rally.
As data from Farside Investors shows, ETH ETFs have seen over $500 million in inflows this week and over $1.3 billion since the start of this month. This signals increased demand from institutional players, further strengthening the cryptocurrency’s momentum.
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Additionally, Donald Trump-backed DeFi project World Liberty Financial Initiative (WLFI) acquired approximately $10 million in ETH yesterday. Lookonchain said the WLFI wallet purchased 2,631 ETH at $3,801 per token.
For Jelle, “it seems that the ETH season has just received the green light from the institutions”. If Ethereum reclaims the $3,950 resistance as support, there will be “very little in the way of new all-time highs from here,” the analyst added.
He predicted that Ethereum could reach $5,000 after its breakthrough and that 2025 would be a “comeback year for ETH.” At the time of writing, ETH is trading at $3,951, up 4.7% on the daily time frame.
Featured image from Unsplash.com, chart from TradingView.com
