Analysts expect $4,100 as ETH reclaims key support.
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Ethereum (ETH) has regained an important support area with a significant recovery of 4.7% over the past 24 hours. The performance has sparked optimism among some market observers, who believe the cryptocurrency will surpass key resistance levels in the coming days.
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Ethereum withdraws major support
Almost a week ago, Ethereum topped $4,000 for the first time in nine months, putting it closer to its March highs and the long-awaited $4,100 resistance level. However, the cryptocurrency’s rise was briefly halted after the cryptocurrency market fell significantly.
Earlier this week, ETH fell nearly 10% as Bitcoin fell back to $95,000 and fell below $3,500. After the retracement, the second-largest cryptocurrency by market capitalization steadily rebounded, regaining the $3,800 support zone on Wednesday afternoon.
ETH prices then rose another 2% in the early hours of Thursday, trading above the $3,900 level again. With Ethereum regaining this key area, cryptocurrency analyst Carl Runefelt noted that the cryptocurrency is trading back above the rising support trend line that was lost during the market correction.
The king of altcoins was also retesting the 6-day descending trend line on the 4-hour chart, targeting a surge towards $4,000 after successfully breaking the $3,940 level.
Ethereum broke this resistance line in the next hour, surging to a daily high of $3,985 before falling back to $3,945. According to analysts, maintaining above this level could push the price of ETH to $4,100 in the coming days.
Will ETH soon hit $5,000?
Despite reclaiming the $3,900 area, Ethereum still needs to successfully turn another multi-year resistance into support, according to some analysts. Analyst Alex Clay recently pointed out that ETH has retested the $9,350 level from 2021, but has failed to turn into support over the past few years.
Ethereum has faced rejection at this resistance level on four occasions. However, once ETH broke and held this level, it rebounded towards $4,878, its all-time high (ATH) from about three years ago.
Crypto analyst Jelle has suggested that Ethereum is preparing for a major move after recently breaking its multi-year pennant. ETH-based exchange-traded funds (ETFs) have seen huge gains following the post-election rally.
The ETH ETF has seen inflows of over $500 million this week and over $1.3 billion since the start of the month, according to Farside Investors data. This is a sign of increased momentum for the cryptocurrency due to increased demand from institutional players.
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Moreover, the World Liberty Financial Initiative (WLFI), a DeFi project backed by Donald Trump, acquired around $10 million in ETH yesterday. Lookonchain said. The WLFI wallet purchased 2,631 ETH at $3,801 per token.
For Jelle, this time “it looks like the ETH season has been given the green light to ‘go ahead’ by the institutions.” If Ethereum breaks the $3,950 resistance back into support, “there will be little that will stand in the way of a new all-time high from here,” the analyst added.
He predicted that Ethereum could reach $5,000 after its breakout and that 2025 will be “the comeback year for ETH.” As of this writing, ETH is trading at $3,951, up 4.7% on the daily time frame.
Featured image from Unsplash.com, chart from TradingView.com