Since the price of Ethereum (ETH) dropped below $4,000 on December 17, it has struggled to recover that level, leading to much speculation that ETH may not return to this range before the end of 2024.
However, the 5% price increase in the past 24 hours suggests that sentiment may be changing. For Ethereum to challenge the $4,000 mark again, several key factors need to converge. Here is what needs to happen.
Ethereum holders are preparing to overcome obstacles
According to information from In/Out of Money Around Price (IOMAP), the current price of Ethereum is experiencing strong support at $3,352. At this point, 3.34 million Ethereum addresses hold 3.18 million coins and are in profit.
IOMAP classifies addresses based on unrealized profits, losses, or breakeven points. The larger the volume or number of addresses in the accumulation zone, the stronger the support or resistance. Therefore, a large volume outside of profit signals stronger resistance, while a large volume in profit indicates stronger support.
As seen below, the main resistance level for the Ethereum price to break through is at $3,508. Here, 3.90 million Ethereum addresses have bought 1.62 million ETH. Therefore, if buying pressure increases, the value of this cryptocurrency could surpass the obstacle and trade close to $4,000.
Ethereum In/Out of Money Around Price. Source: IntoTheBlock
Another indicator supporting the bullish price trend is the Coin Holding Time. As the name suggests, Holding Time measures the duration a cryptocurrency has been held without being sold or traded.
When holding time increases, this indicates that holders are not selling. Conversely, when holding time decreases, this indicates that investors are selling.
According to data from IntoTheBlock, the holding time of Ethereum has increased by 332% in the past seven days. If this trend continues, the bullish argument for Ethereum mentioned above could be confirmed.
Ethereum Coin Holding Time. Source: IntoTheBlock
ETH Price Prediction: Higher value coming soon?
From a technical perspective, ETH has crossed the Ichimoku cloud. The Ichimoku cloud is an indicator that determines support and resistance. When the cloud is above the price, it indicates resistance.
But when the price is above the cloud, it indicates support, which could push the price higher. Therefore, for ETH, the cryptocurrency value could rise to $4,109. If the bulls hold above $4,000, the value could rise as high as $4,500.
Daily Ethereum Analysis. Source: TradingView
However, if the bears dominate, things may not go that way. In that scenario, the price of Ethereum could drop to $3,111. If selling pressure intensifies, the price could fall below $3,000.