Crypto analyst Rekt Capital noted that Ethereum is struggling to break through the psychological resistance of $4,000.
“Ethereum is still struggling to break through the psychological resistance of $4,000,” the analyst wrote in a market report on Dec. 20. Ether has climbed above $4,000 several times in the past 30 days, reaching a high of $4,077 on Dec. 6, but has failed to hold that level, according to CoinMarketCap data.
$3,000 Psychological Support Level
Rekt Capital states that the $3,000 level has now become “psychological support” for Ethereum. Ether last touched this level on November 9. Previously, the ETH price had been trading below $3,000 since the beginning of August. The analyst expects Ethereum to consolidate between $3,000-$4,000 in the near term. However, he also emphasizes the possibility that it could fall to the $3,000 region with a decrease of more than 10 percent from its current price of $3,466.
“If ETH can form a bottom near $3,000, this could lead to the development of the right shoulder for an inverse head and shoulders pattern,” Rekt Capital said. This pattern is often seen as a signal of a change in trend direction.
Ethereum Supply and ETF Investments Could Trigger a Strong Uptrend
Some analysts believe that Ethereum’s low supply levels on exchanges and increased inflows into spot Ether exchange-traded funds (ETFs) could have a positive impact on its price. According to data from on-chain analytics firm CryptoQuant, the ETH balance on exchanges has fallen to an 8.5-year low of 9.2 million ETH, representing a decrease of about 10 percent in the past year.
On the other hand, inflows to spot Ether ETFs are expected to continue to increase until 2025. Spot Ether ETFs, which were launched in the US in July, have received approximately $2.43 billion in investments to date. Analysts predict that the performance of Ether ETFs will be even stronger if regulators allow these funds to earn returns through staking.
2025 Forecast: $6,000 Level
Asset manager VanEck predicts that Ethereum’s spot price could reach $6,000 by the fourth quarter of 2025. Following the launch of spot Ether ETFs in July, Ether was expected to experience a similar rally to Bitcoin. However, weak initial inflows have reduced the likelihood of Ether reaching a new all-time high of $5,000 by the end of the year.
Stay tuned for new information.