Last week, ETH had its strongest performance since December 2020, but with the momentum down to $2,500, the forecast for Ethereum's price increase is being questioned.
After the US-China trade deal and the launch of the Pectra hard fork, the market obstacles causing the leading altcoin to stagnate are gradually disappearing.
The rally has ended a month-long consolidation phase, within a range from $1,450 to $1,900. Overcoming this barrier, ETH has a basis to discuss the 'best cryptocurrency to buy'.
Why This Rally is Different from Other Coins
Unlike many other cryptocurrency rallies driven by excessive leverage and speculation, Ethereum's recent price action is primarily driven by actual demand in the spot market.
Last week, the estimated leverage ratio (ELR) of Ethereum dropped sharply from 0.76 to 0.69, according to CryptoQuant data. This declining trend indicates that derivative traders are using less leverage.
Along with significant outflows—about 323,700 ETH has left exchanges in just the past four days—and an increase of over 180,000 ETH staked just in the past week. These measures strongly imply that, rather than short-term speculative trading, investors are employing longer-term holding techniques.
Ethereum Price Analysis: Can the Bullish Trend Continue?
The slowdown aligns with bearish technical signals. The daily RSI has crossed into the overbought zone at 80, a clear sign that buyers have exhausted.
What goes up must come down - a minor correction seems to be the next natural step to rebalance the scales.
However, the symmetrical triangle pattern formed since 2021 has re-emerged after a temporary false breakout. This recovery move is supported by strong momentum indicators.
The RSI has broken into the bullish zone above this signal line after oscillating around 40 - an initial indicator that selling pressure has given way to a bullish trend.
More importantly, the MACD has shifted to a bullish trend for the first time since the post-inauguration rally.
The price line has crossed above the signal line in a bullish golden cross pattern - a pattern suggesting a long-term trend change in such a high time frame.
The 200 SMA line has also returned as a strong support level, signaling a potential bottom for the correction and further reinforcing the view of a long-term bullish trend forming.
If buying pressure returns, Ethereum could aim for a breakout target from this triangle, with the next important target being the resistance level of $2,970 - an immediate increase of 17%.
To retest the upper resistance, the price would need to increase by 50% to around $3,750.
Fundamental factors such as the Pectra upgrade and improved macroeconomic conditions further bolster a cautiously optimistic long-term outlook for Ethereum.