Ethereum (ETH), the second-largest cryptocurrency, has experienced a remarkable surge in its price over the past month. This bullish trend in the crypto market, combined with BlackRock’s involvement, has propelled ETH to its highest point of the year at $2,139. This surge in value is notable considering ETH’s previous struggles to gain momentum, despite successful upgrades such as The Merge in April.
The turning point for Ethereum came when BlackRock filed for a spot ETH exchange-traded fund (ETF), causing a significant reversal in the ETH to Bitcoin (BTC) ratio. This move had a substantial impact on the market, with ETH prices surging above $2,000 for the first time since April. Additionally, daily spot trade volumes reached $7 billion, marking the highest level since the collapse of FTX.
The ETH ETF narrative further fueled the ongoing rally, bolstered by improved global risk sentiment and declining US Treasury yields. This shift in sentiment is evident in the increased dominance of altcoin + ETH volume relative to BTC, which rose to 60% – its highest level in over a year. During bull rallies, it is a common trend for altcoin volume to increase relative to BTC.
The surge in demand for Ethereum has also resulted in rising leverage, as reflected in the recovery of ETH open interest to levels seen in early August. On the other hand, BTC open interest has declined over the past month due to liquidations on Binance, leading to the Chicago Mercantile Exchange (CME) surpassing Binance as the largest BTC futures market. Furthermore, ETH funding rates, which serve as a gauge of sentiment and bullish demand, have reached their highest levels in over a year, indicating a significant shift in overall market sentiment.
Renowned crypto expert Michael Van de Poppe believes that Ethereum is on the verge of a significant breakthrough. Van de Poppe suggests that if Ethereum manages to surpass the crucial $2,150 resistance level, it could signify the end of the bear market. Drawing a parallel with Bitcoin’s critical $30,000 barrier, breaching this level could potentially pave the way for a substantial rally, pushing Ethereum towards the price range of $3,100 to $3,600.
However, Ethereum has yet to touch the $2,150 resistance line, as it currently faces a pre-existing obstacle in the form of its yearly high of $2,139. This pivotal level has halted the cryptocurrency’s bullish momentum, acting as a formidable resistance. As a result, Ethereum has been consolidating within a narrow range between $2,050 and $2,100 for the past three days.
The forthcoming days will reveal whether Ethereum can overcome its immediate resistance levels and establish a consolidated position above them. Much like Bitcoin’s struggle to surpass the $31,000 level for over seven months, Ethereum must navigate these obstacles to continue its upward trajectory. Only time will tell if Ethereum can break free from its current consolidation and reach new heights in the crypto market.