Ethereum Bulls Eye $5,000 Breakthrough as $7.5B Accumulation Zone Forms Strong Support
Ethereum (ETH) is currently worth about $4,500, which is a 3.6% increase in the last 24 hours. This is because the second-largest crypto by
Quick overview
- Ethereum's price has increased by 3.6% in the last 24 hours, currently valued at around $4,500.
- A significant accumulation of $7.5 billion in ETH has created a strong support zone between $4,300 and $4,400.
- Institutional demand for Ethereum is at an all-time high, despite a decline in network activity and fees.
- The path to reaching $5,000 for ETH may depend more on macroeconomic conditions than on cryptocurrency-specific factors.
Ethereum ETH/USD is currently worth about $4,500, which is a 3.6% increase in the last 24 hours. This is because the second-largest cryptocurrency by market capitalization is still trading in a limited range. Even though $216 million has come into spot ETFs recently and institutional investors are buying more, traders are still unsure if ETH can keep going up near the critical $5,000 milestone.
Massive $7.5 Billion Accumulation Creates Fortress-Like Support
Support On-chain data shows a big change that could affect Ethereum’s short-term path. In the $4,300 to $4,400 area, almost 1.7 million ETH worth $7.5 billion has been built up, which analysts call a strong support zone. This pattern of accumulation, which includes large withdrawals from centralized exchanges, shows that long-term holders are getting ready for possible gains.
The accumulation data shows that these addresses have an average cost basis of around $4,300, which sets a key level that could stop big drops. Exchange flow analysis shows that Binance has had the most outflows during this accumulation phase. However, addresses depositing ETH onto the exchange have an average cost basis closer to $3,150. This shows that institutional holders and active traders have different strategies for positioning themselves.
Institutional Demand Reaches Record Highs Despite Network Activity Decline
Institutional participation in Ethereum markets has never been higher, with CME open interest reaching all-time highs. The concentration in short-term maturities (one to three months) shows that institutions are getting more involved, while the concentration in longer-term maturities (three to six months) shows that people are becoming more confident in Ethereum’s medium-term future.
But this excitement from institutions is very different from the network’s fundamentals, which are getting worse. In the last 30 days, Ethereum chain fees were only $42 million, which is a 7% drop from the month before. The number of active addresses on Ethereum’s base layer has stayed the same, however layer-2 solutions like Base, Arbitrum, and Polygon have lost a lot of users.
Even with these problems on the network, corporations like Bitmine Immersion Tech have kept buying more ETH. In the previous week alone, they bought 202,500 ETH worth more than $880 million, raising their total holdings to more than $9.1 billion.
ETH/USD Technical Analysis Points to Critical $4,500 Inflection Level
Ethereum is at a very important position from a technical point of view at the $4,500 resistance level. The cryptocurrency has been trading in a tight range of $4,200 to $4,500 for the past two weeks. This is after it briefly hit an all-time high of $4,956 in late August. The current price activity demonstrates that people are not sure what to do, especially when compared to Bitcoin and Solana, which have been moving more quickly.
ETH futures are trading at a little 5% premium over spot markets, which shows that leveraged traders are not really interested. This low premium shows that there isn’t much speculative interest, even though the August surge above $4,800 didn’t lead to a protracted positive trend.
Some observers see the monthly MACD indicator turning green recently as a sign that the market is bullish after three years of consolidation pressure. Merlijn, a crypto trader, said that Ethereum might make a “parabolic” rise if it breaks above $4,500.
Ethereum Price Prediction: Path to $5,000 Depends on Macro Conditions
In the future, it seems like Ethereum’s capacity to reach $5,000 will depend more on general economic conditions than on elements that are special to cryptocurrencies. The S&P 500 has gone up recently because people think the Federal Reserve would drop interest rates after bad job numbers. This has made things more complicated, as traditional risk assets act more like safe havens.
Pelin Ay, a crypto expert, is still hopeful and thinks that ETH might reach $6,800 before the end of the year. This is based on the strong accumulation basis and institutional positioning. But there are a number of things that could come in the way of reaching this goal, such as the possibility of economic turmoil and the chance that investors will move their money into other large cryptocurrencies.
The short-term technical picture shows that the $7.5 billion accumulation zone offers good protection against losses, but if the price drops below $4,200, it might trigger a liquidity sweep toward the $4,000-$4,100 demand zone. On the other hand, a sustained move above $4,500 might immediately change the direction of the market and speed it up toward the $5,000 psychological resistance level.
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