A bullish breakout towards $4,000 is more likely for ETH

ethereum price has been consolidating above the 100-day and 200-day moving averages, indicating an uptrend.

Given the launch of the eth spot ETF, an upward momentum targeting the upper boundary of the wedge is anticipated in the medium term.

By shayan

The daily chart

A close examination of ethereum’s daily chart reveals that after breaking above the critical 100-day moving average at $3,354, it entered a period of sideways fluctuation, with no clear direction in price.

This phase confirms the breakout and suggests a balance between buyers and sellers in the market.

However, with the official launch of the eth spot ETF and a net inflow of $106.6 million on its first day, ethereum buying interest is expected to rise, paving the way for a continuation of the bullish rally. In this scenario, the main target for buyers is the upper boundary of the wedge at $3,700.

In summary, the price is confined within a crucial range, bounded by the upper boundary of the wedge ($3,700) and significant support at $3,400. A bullish breakout seems more likely.

The 4-hour chart

On the 4-hour chart, ethereum buyers have struggled to break above the previous major swing high of $3,500 amid prevailing selling pressure, resulting in a period of sideways consolidation.

During this consolidation, the price has formed an ascending wedge pattern.

Typically, this pattern suggests a bearish reversal. However, given the bullish sentiment in the market, a resurgence of demand is expected, which could lead to a breakout above the wedge.

However, in case of an unexpected bearish breakout, the price could enter a short-term pullback phase before embarking on the next impulsive bullish move. This bearish scenario could offer a better opportunity for participants to accumulate eth at lower prices.

By shayan

With the ethereum price recovering from below the $3K mark and the official launch of eth Spot ETFs, analyzing investor behavior using on-chain metrics can provide insights into the reasons for the recent recovery and indications for future trends.

The chart below shows ethereum’s exchange reserve metric, which measures the amount of eth held in exchange wallets. An increase in exchange reserves typically indicates that investors are depositing their coins on exchanges, likely to sell them. Conversely, a decrease suggests accumulation by holders, as coins are taken off exchanges for long-term storage.

Recent data reveals that the FX reserves metric has been falling rapidly in recent weeks, particularly following the news of the potential launch of Spot ETFs in July. This trend indicates that many large investors have taken advantage of the recent market correction to buy the dip. These investors are now withdrawing their currencies from exchanges, reducing the available supply and signaling long-term holding intentions. This reduction in available supply, coupled with the growing buying interest driven by the launch of Spot ETFs, sets the stage for a potentially sustainable rally in the coming months.

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