Ethereum, mirroring the performance of Bitcoin and other top altcoins, is back above $3,000, days after the fall below $2,800. As the second most valuable coin recovers, injecting optimism among crashed token holders and traders, a close above $3,200 will be crucial in catalyzing demand.
Ethereum Rising: Will Bulls Push Above $3,200?
According to IntoTheBlock on July 10, if Ethereum edges above the $3,200 level, it will be a massive development for traders. When this happens, an estimated two million entities who traded ETH at this price point will be in the money.
Therefore, if prices retest this level, those who went long can exit at break even. Alternatively, other “diamond hands,” expecting more gains on the horizon, can double down and ride the expected leg up.
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Thus far, there are hints of strength. However, though sellers are still in control, a breach of $3,300 will be crucial in the short to medium term. The $3,300 level, looking at the ETHUSDT candlestick arrangement in the daily chart, is previous support, but it is now resistance.
A breakout, ideally with rising volume, will likely serve as a base for more gains, lifting the coin towards a key liquidation level at $3,700 and later $3,900.
Conversely, if sellers take over, reversing recent gains and aligning with the July 4 and 5 losses, a drop below $2,800 will signal trend continuation. Looking at candlestick arrangements, Ethereum will dump to new multi-week lows in that event, even dropping to $2,500.
Eyes On Spot ETFs, Whales Accumulating As ETH Becomes Scarce
Overall, analysts are optimistic, expecting Ethereum to float higher. The anticipated launch of spot Ethereum exchange-traded funds (ETFs) in the coming days is a big catalyst behind this bullish outlook.
Like how to spot Bitcoin ETFs opened the floodgates for institutional exposure in the world’s most valuable coin, the same inflow will likely be seen in ETH. With institutional demand, supports think ETH will tear higher, breaching $4,100 and registering new 2024 highs in the coming months.
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Interestingly, even the spot Ethereum ETF launch expectations do not seem to change traders’ outlook. On-chain data reveals that bullish sentiment is at a one-year low, pointing to caution among ETH holders.
Meanwhile, as on-chain data illustrates, ETH outflows from exchanges have increased recently. All exchanges, including Binance and Coinbase, control 10.17% of ETH in circulation. Parallel data also shows that another chunk, representing 28% of all ETH in circulation, is staked.
Feature image from DALLE, chart from TradingView
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