Ethereum's price strongly broke through the $3600 barrier on July 18, 2025. This recent high not only arises from technical factors but is also influenced by macroeconomic conditions and industry dynamics. This article will provide a simple and understandable analysis of this significant ETH surge from the perspectives of technical analysis, macro factors, and derivative factors.
Technical analysis
ETH's rise this time shows significant signs of a technical breakthrough. On the daily chart, ETH/USD has surged upwards, breaking through the previous key resistance level of around $3520, demonstrating strong bullish momentum.
As the price rises above $3600, ETH has reached a new high since January. Many technical indicators also reflect the strong trend in the market.
For example, on the 14th, the Relative Strength Index (RSI) rose to a high level above 80 (recently around 83.6). An RSI in the overbought range indicates that bulls are dominant in the short term, but it also suggests a risk of a technical pullback in the market. However, although the current RSI is high, there is no obvious divergence, indicating that buying pressure remains strong.
In addition, we can see from the chart that the price has been running above the upper band of the Bollinger Bands, significantly widening the bands, reflecting that the current market volatility is increasing.
After breaking through $3600, ETH's short-term technical pattern has further improved. Currently, the moving averages on the 4-hour level are in a bullish arrangement, with the 20-period moving average (around $3325) and the 50-period moving average (around $3100) well below the current price, providing support. From the daily perspective, ETH previously consolidated around $2900 to form a solid bottom, and if there is a pullback in the future, that area will become an important support cushion.
Key price levels: Looking ahead, the initial resistance above is around $3700, followed by resistance near the previous high point of about $3880. If the upward trend continues, there is a chance to challenge further Fibonacci extension targets, such as around $4380. Conversely, if ETH cannot maintain above $3600 and falls below the first support level of $3520, further technical pullbacks may occur, with strong support to watch around $3150.
Overall, the current technical outlook is bullish, but after a rapid short-term rise, a slight pullback for consolidation cannot be ruled out. One should closely monitor changes in trading volume and indicators to grasp the rhythm.
Macroeconomic factors impact
Having discussed the technical indicators, let's explain this round of increase from a macro perspective. I believe this increase includes multiple factors such as favorable policy regulation, an increase in market risk appetite, and institutional capital entering the market.
First, recently there has been significant good news from the United States – the House of Representatives voted to pass three cryptocurrency bills, including the highly anticipated 'GENIUS Stablecoin Bill', which will be submitted to President Trump for signing into law.
In addition, President Trump is preparing to sign an executive order allowing 401(k) retirement accounts to invest in alternative assets, including cryptocurrencies.
The breakthroughs on the policy front have provided unprecedented support and legitimacy to the crypto market, greatly boosting confidence in the future.
At the macroeconomic level, easing inflation data and expectations that the Federal Reserve's rate hike process is nearing its end have increased overall market risk appetite. Safe-haven funds are gradually returning to the stock and crypto markets, creating a favorable external environment for risk assets like ETH. At the same time, the weakening of the US dollar index has also enhanced the relative attractiveness of non-legal tender assets like Ethereum.
Statistics show that since mid-July, only BlackRock's Ethereum trust fund recorded an inflow of about $499 million on a single day on July 16, and the total inflow of funds into ETH spot ETFs in July reached as high as $2.27 billion. The inflow of ETF funds even once exceeded the market's new ETH supply.
This is seen by many as a precursor to a new bull market, with the participation and layout of large institutions not only directly boosting buying demand but also enhancing market confidence in the future approval of more mainstream investment channels for ETH.
More and more traditional institutions and enterprises are including Ethereum in their balance sheets.
US-listed BitMine Immersion disclosed that it holds ETH valued at over $1 billion and plans to acquire 5% of Ethereum's circulating supply.
The 'World Liberty' fund, involving the Trump family, recently purchased nearly $8 million worth of ETH over two consecutive days, bringing its total holdings to 70,143 ETH, similar to MicroStrategy's accumulation of Bitcoin.
Nasdaq-listed BTCT Digital Company even announced that it would convert all its current and future Bitcoin holdings into ETH.
These signs indicate that Wall Street and large investors are flooding into the Ethereum market, with 'long-term funds' showing significantly increased interest in ETH.
In conclusion, ETH's recent breakthrough above $3600 is both a result of the explosive strength of the bulls in the technical landscape and the support from macroeconomic easing expectations and industry benefits. From a technical perspective, Ethereum has strong momentum after overcoming significant resistance, but attention should be paid to the potential volatility adjustments that may arise from overheated short-term technical indicators. In terms of the macro environment, stable interest rates, moderate inflation, and a weakening dollar provide good external conditions for the crypto market.
I believe that everyone should maintain continuous attention to the subsequent market trends. Once there are unexpected macro changes, the volatility of cryptocurrency assets may increase. We need to look at short-term fluctuations rationally and implement risk control. In the context of a favorable overall trend, seizing the opportunity during pullbacks to gradually position ourselves without chasing highs is a relatively prudent strategy!