The price of Ethereum is skyrocketing as more institutions continue to accumulate. BitMine, led by Tom Lee, which now holds 833,000 coins, is preparing for a massive buying wave. In a statement, it announced that it will raise $24 billion for this purchase. This is a huge amount considering that all Ethereum ETFs manage over $25 billion in assets.
Other treasury companies in Ethereum, such as SharpLink and The Ether Machine, have continued their buying streak. Similarly, spot ETH ETFs recorded inflows of $1 billion on Monday, the largest daily buying streak since their inception. They have already accumulated more than $10 billion in inflows, with BlackRock's ETHA ETF leading the way.
The price of Ethereum is also skyrocketing thanks to its market dominance in most sectors of the cryptocurrency industry. It holds a dominant position of over 66% in the decentralized finance sector, with leading companies like Aave, Lido, and EigenLayer dominating their respective industries. Its total value locked (TVL) has increased by 32% in the last 30 days, surpassing $200 billion.
Ethereum is also the largest chain in the stablecoin sector, where it holds over $138 billion in assets. This is noteworthy, as Donald Trump recently enacted the GENIUS Act, further popularizing these tokens.
More data shows that open interest in the futures market has surged to an all-time high of $60 billion, well above the April low of $17 billion. These figures indicate that the cryptocurrency is experiencing strong demand, which is positive.
The daily chart shows that the price of ETH remains stable and gains momentum day after day. The Average Directional Index (ADX), widely used to measure the strength of a trend, has risen to nearly 45. This pattern indicates that the trend is strengthening.
However, there are three main technical reasons why the price of Ethereum could soon plummet to $4,100:
▫️Firstly, it could plummet due to a mean reversion, a situation where an asset returns to its historical averages. In this case, ETH remains well above the 100-day moving average of $3,000 and the 50-day moving average of $3,420.
▫️Secondly, the price of ETH has become highly overbought, with the Relative Strength Index moving to 74. An overbought asset tends to pull back over time as investors take profits.
▫️Finally, the coin could present a breakout and retest pattern, where it will drop and then retest the previous support. This is important, as the new test will help confirm the bullish price forecast for ETH in 2025.
The price of Ethereum has experienced a dizzying recovery, rising from $1350 in April to $4500 today. While this bullish momentum is expected to continue this year, a significant pullback to $4100 is likely.
