Ethereum is poised to reclaim the $4,000 level as it approaches its historical highs. The second-largest cryptocurrency has faced skepticism throughout the cycle, with some analysts predicting it will underperform compared to previous bull markets. However, Ethereum has surprised skeptics, steadily climbing in recent weeks despite market uncertainties.
Key on-chain indicators from Glassnode reveal an important trend that could drive prices further up: since late November, Ethereum whales have been actively accumulating. This indicates growing confidence among major holders, who are preparing for potential upward movement. Historically, whale accumulation often occurs before significant price fluctuations, suggesting the possibility of a breakout in the short term.
Although there are still divergences in the market regarding Ethereum's trajectory, its ability to maintain upward momentum near the $4,000 mark may determine its performance in the coming weeks. A breakthrough of this key resistance level could open the door to new highs and further solidify ETH's position as a leader in a sustained bull market cycle.
Ethereum Mega-Whale balance growth
Since November 5, Ethereum has experienced a steady but moderate rebound, but the real fireworks for ETH seem yet to ignite. As Bitcoin skyrockets into price discovery, several altcoins are performing better than expected, and Ethereum investors are looking for clear signals that the second-largest cryptocurrency is poised for a bull market.
Top analyst Ali Martinez shared key on-chain data on X that provides interesting insights into Ethereum's current state. Martinez emphasized that since the price broke the $3,330 level, Ethereum whales (entities holding large amounts of ETH) have been actively accumulating.
Ethereum whales loading | Source: Ali Martinez on X
This accumulation trend indicates that smart money is preparing for a significant rise in the coming months. Historically, whale accumulation is often a precursor to a strong price rebound, as these large investors tend to predict major market changes ahead of retail traders.
However, this assertion is not entirely optimistic. While whale accumulation may indicate confidence, it also raises concerns about potential bull market traps. If market conditions change or Bitcoin's dominance suppresses altcoin growth, these large holders may quickly pivot, selling their ETH for other assets. This move could catch smaller investors off guard, leading to a sharp correction.
For Ethereum, maintaining above key levels like $3,800 while breaking through key resistance could be the catalyst needed to trigger a true bull market. Until then, ETH remains a favorite on the watchlist, balancing potential with uncertainty.
Price tests key resistance
Ethereum (ETH) is trading at $3,950, struggling for days to break the key $4,000 resistance level. Nevertheless, the price remains resilient, indicating strong support from the market. Clearing this level is crucial to confirming the continuation of the uptrend, as $4,000 represents a psychological barrier and a key resistance area for the asset.
ETH tests supply at $4,000 | Source: ETHUSDT chart on TradingView
If Ethereum fails to break through the $4,000 mark, a price pullback to around the $3,500 lower demand area is expected. This level has provided strong support in recent weeks, acting as a buffer during periods of increased selling pressure. A pullback to this area could allow for new buying momentum, laying the groundwork for another attempt to break higher.
However, recent market dynamics suggest that Ethereum may be ready for a significant rise. The skyrocketing discovery of Bitcoin's price and growing optimism toward altcoins create a bullish environment. As highlighted by on-chain data, as whales continue to accumulate ETH, market participants are becoming increasingly confident in Ethereum's ability to retest and surpass its historical highs.
Featured image from Dall-E, charts from TradingView
