Ethereum has faced two consecutive weeks of decline as concerns over weak demand and a shrinking market share persist. However, several bullish catalysts could drive its price parabolic in the near future.
Ethereum’s Recent Performance
Ethereum (ETH) recently dipped to $2,140 before rebounding to $2,620 as the broader cryptocurrency market stabilized. Despite this recovery, ETH remains approximately 37% below its December all-time high.
1. Rising Competition from Solana
Data from DeFi Llama reveals that Ethereum’s 30-day trading volume stands at $95 billion, significantly trailing behind Solana’s $264 billion. Additionally, Ethereum has been overtaken in network fees, generating $172 million, placing it behind competitors like Tether, Tron, Jito, Solana, and Circle.
Despite these challenges, Ethereum’s long-term viability remains strong due to its robust infrastructure and continued developer adoption.
2. Spot Ethereum ETF Inflows Increasing
One of the biggest bullish catalysts for Ethereum is the growing spot Ethereum ETF inflows. According to SoSoValue, these funds have experienced six consecutive days of net inflows, totaling $3.17 billion. This suggests that institutional investors are accumulating Ethereum at lower prices, signaling strong demand.
While Ethereum ETFs still have a long way to go to match Bitcoin’s $40 billion in inflows, the rising interest from Wall Street could significantly impact ETH’s price trajectory.
3. Declining Ethereum Balances on Exchanges
Another positive indicator for Ethereum’s price is the declining balances on crypto exchanges, a sign of accumulation by investors. Data from CoinGlass shows ETH balances on exchanges have dropped from 16.1 million earlier this year to 15.36 million, marking the lowest level since December.
Additionally, increased activity in the over-the-counter (OTC) market suggests that large institutional players are executing high-volume transactions away from centralized and decentralized exchanges.
Technical Indicators Signal a Bullish Reversal
The weekly ETH price chart shows a hammer pattern forming after its drop to $2,140. This pattern, characterized by a long lower wick and a small body, is a strong bullish reversal signal. A similar setup occurred in August when Ethereum found support at $2,139 before rebounding.
With ETH currently supported by its 200-week moving average, analysts predict a potential retest of the $4,080 resistance level. If Ethereum breaks past this point, it could surge toward its all-time high of $4,800, followed by a push toward $6,000.
Final Thoughts
Despite recent setbacks, Ethereum’s strong fundamentals, rising ETF inflows, and declining exchange balances position it for a potential breakout. If these bullish trends persist, ETH could see significant gains in the coming months.
