As the new year begins, Ethereum’s native token, Ether (ETH), has been making waves in the cryptocurrency market. In this article, we will delve into the recent price surge of ETH and explore the technical aspects that are driving its upward momentum.
A New Year, A New Trend?
The past few days have seen a significant increase in Ethereum’s price, with a 3.40% jump on January 2nd, moving it closer to trading above $3,500 for the first time since December 19th. This surge can be attributed to several factors, including the broader crypto market’s overall performance.
A Broader Market Rally
The cryptocurrency market as a whole has been experiencing a resurgence in recent days. Bitcoin (BTC), the largest cryptocurrency by market capitalization, has risen above $96,000, while major altcoins such as XRP and Solana have also seen significant gains. This broader market rally has contributed to Ethereum’s price increase.
Bitcoin Dominance Drops Below 58%
The continued decline in Bitcoin’s dominance index is another factor that has contributed to Ethereum’s price surge. The dominance index, which measures the percentage of the total cryptocurrency market capitalization held by Bitcoin, dropped below 58% for the first time in two weeks. This decline implies that altcoins are collectively gaining market share against Bitcoin.
A Declining Wave in Bitcoin Dominance
Anonymous crypto trader Satoshi has highlighted the decline in Bitcoin’s dominance index as a potential sign of an ongoing altcoin season in 2025. According to Satoshi, "Altcoin history is doing its thing again. Doubting Altcoin season? Think again!"
Futures Traders and Open Long Positions
Data from CryptoQuant shows that futures traders have been taking on open long positions, which has led to a sharp rise in funding rates over the past couple of days. This increase in funding rates indicates that a majority of traders are optimistic about Ethereum’s price prospects.
Ethereum Exchange Reserves Decline
The decline in Ethereum exchange reserves is another indicator of increased buying activity. With spot buyers entering the market, Ethereum’s price has been driven upward by the resulting increase in demand.
Ascending Triangle Pattern Sets a $4,000 ETH Target
From a technical perspective, Ethereum is forming an ascending triangle pattern on its 4-hour chart, which is eyeing a breakout above the key resistance level at $3,500. However, there are a few hurdles that need to be overcome before this can occur.
Establishing Breakout Momentum
To confirm a strong breakout from the triangle pattern, Ethereum needs to establish momentum by closing above each of its 50-day, 100-day, and 200-day EMA levels. A bullish close above $3,500 on the daily chart would be pivotal in confirming this momentum.
Probability of a Bullish Move
With an ascending triangle pattern carrying a 75% probability of a bullish move, Ethereum’s immediate target remains around $3,850 and $4,000. This represents a 15% swing from ETH’s current value.
Conclusion
Ethereum’s recent price surge is a result of various factors, including the broader crypto market’s performance and the decline in Bitcoin’s dominance index. The ascending triangle pattern on Ethereum’s 4-hour chart indicates a strong potential for a bullish move, with targets set at $3,850 and $4,000.
Disclaimer
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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