Crypto analyst Rekt Capital suggests that Ethereum’s price might hover between $3,000 and $4,000 in the near future.
While this range-bound movement seems likely, he cautions that a dip towards the lower end could happen, following a notable 10% decline in the past week.
Current Price Dynamics
At present, Ethereum struggles to maintain values above the $4,000 level, which Rekt describes as a pivotal psychological resistance point.
Though Ether has breasted the $4,000 mark several times in the past month, reaching a peak of $4,077 on December 6, it has had difficulty holding onto this height, as indicated by CoinMarketCap data.
Rekt points out that the $3,000 price point has now become a vital psychological support for Ethereum, a level it last touched on November 9.
Before that, Ether remained under $3,000 since August 3.
He predicts that the cryptocurrency is likely to stabilize within the $3,000 to $4,000 corridor for the time being.
However, with its current price sitting at $3,466, there’s a possibility of a further drop exceeding 10%, potentially dragging it closer to the $3,000 range.
It will be crucial to observe if Ethereum can form a support level around this area, as this could pave the way for an inverse head and shoulders pattern.
Market Influences
A variety of factors contribute to the ongoing market dynamics impacting Ethereum’s price.
One notable trend is the dwindling supply of Ether available on exchanges, coupled with increasing investments in spot Ether exchange-traded funds (ETFs).
As of December 17, the number of Ether held on exchanges hit an 8.5-year low of 9.2 million ETH, representing a nearly 10% fall from the previous year’s figures.
Looking ahead, some analysts remain optimistic about the persistent inflows into spot Ether ETFs, suggesting that these funds might even outperform Bitcoin ETFs by 2025.
Since their launch in the United States on July 23, spot Ether ETFs have attracted approximately $2.43 billion in inflows, and this trend is anticipated to continue through 2025, especially if regulators allow these funds to earn yields from staking.
Asset management firm VanEck predicts that the price of Ether could soar to $6,000 by the fourth quarter of 2025.
Future Outlook
Initially, when spot Ether ETFs were introduced in July, many hoped for Ether’s performance to mimic Bitcoin’s. However, the inflows have fallen short of expectations compared to Bitcoin ETFs, leading to tempered hopes that Ether will break its all-time high and reach $5,000 by year-end.
Source: Cointelegraph
