Ethereum’s price has been showing signs of a bullish trend as it consolidates above the 100 and 200-day moving averages. The recent launch of spot ETH ETFs has added upward momentum, with expectations of a breakout towards $4,000 in the mid-term.
Looking at the daily chart, Ethereum broke above the critical 100-day moving average at $3,354 and entered a period of sideways movement. This phase indicates a balance between buyers and sellers in the market, but the launch of spot ETH ETFs with a net inflow of $106.6 million on the first day is expected to increase buying interest. The primary target for buyers is the wedge’s upper boundary at $3.7K, suggesting a bullish breakout.
On the 4-hour chart, Ethereum buyers have faced resistance at the previous major swing high of $3.5K, leading to sideways consolidation and the formation of an ascending wedge pattern. Despite the pattern typically indicating a bearish reversal, the overall bullish sentiment in the market may push the price to break above the wedge. In the case of a bearish breakout, a short-term retracement phase could offer a buying opportunity at lower prices.
Analyzing on-chain metrics, the Ethereum Exchange Reserve metric shows a rapid decrease in exchange reserves, indicating that large investors have been accumulating ETH and withdrawing it from exchanges for long-term holding. This reduction in available supply, combined with increasing buying interest from the launch of Spot ETFs, sets the stage for a sustainable rally in the coming months.
In conclusion, Ethereum is poised for a bullish breakout towards $4,000, supported by the positive impact of the spot ETH ETFs launch and decreasing exchange reserves. Investors should conduct their own research before making any investment decisions in the cryptocurrency market.