Following a recent price spike that pushed Ethereum (ETH) close to the $4,000 mark, the second-largest cryptocurrency has experienced inflows and renewed market enthusiasm. This is a response to the US Securities and Exchange Commission’s (SEC) approval of Ethereum ETF applications by major asset managers. CoinShares reported that digital asset investment products have seen a total of $2 billion in inflows, contributing to a five-week consecutive run of inflows amounting to $4.3 billion. Trading volumes in exchange-traded products (ETPs) have also increased to $12.8 billion for the week, a 55% increase from the previous week, with inflows observed across various providers.
Bitcoin (BTC) continues to dominate the market, with inflows totaling $1.97 billion for the week, while short Bitcoin products saw outflows of $5.3 million for the third consecutive week. Ethereum has also seen a surge in inflows, recording its best week since March with a total of $69 million, likely in response to the SEC decision to allow spot-based ETFs on Ethereum. Despite these positive developments, Ethereum’s price has struggled to maintain bullish momentum and failed to retest its yearly high of $4,100 reached in March. On Friday, the price dropped as low as $3,577, but there has been an increase in addresses holding more than 10,000 ETH, indicating a spike in buying pressure.
Market analysts have differing perspectives on Ethereum’s future price action. “Trader Tank” predicts that ETH may drop to $3,500 but acknowledges the potential for a bullish reversal upon reclaiming the $3,700 level. Crypto analyst Lark Davis highlights that Ethereum’s supply on exchanges is at an eight-year low, suggesting that upcoming ETFs could result in a “massive supply shock” and lead to a substantial increase in ETH’s price. As Ethereum’s price remains uncertain, market participants eagerly await the next movements in the cryptocurrency, with the question of whether there will be a breakout above $4,000 or a retest of lower support levels at $3,500.
The second-largest cryptocurrency is currently trading at $3,690, down 6.5% in the past two weeks. In conclusion, Ethereum has seen renewed market enthusiasm and increased inflows following the SEC’s approval of Ethereum ETF applications, with positive sentiment observed across various providers. Despite Ethereum’s struggle to maintain bullish momentum in its price, market analysts have differing perspectives on its future price action, with some predicting a drop to $3,500 and others expecting a significant increase due to low supply on exchanges and the impact of upcoming ETFs. As investors and analysts closely monitor the market dynamics, the next movements in Ethereum’s price remain uncertain, with the possibility of a breakout above $4,000 or a retest of lower support levels at $3,500 awaiting an answer.
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