Ethereum (ETH) has shown a strong recovery after the recent FOMC announcement, with a 5.35% increase. Historical data indicates that the price often rebounds quickly after volatility, sometimes with gains of up to 34%. Institutional interest is also on the rise, with a net inflow of $67.77 million into ETH ETFs, led by BlackRock.
In this article, we will analyze the recent price developments, the impact of institutional investments, and the price expectations for Ethereum.
Ethereum Price Recovers After FOMC
In recent months, Ethereum has demonstrated a noticeable recovery pattern following periods of market volatility due to FOMC announcements. Data from Sentiment Feed’s Net Realized Profit/Loss (NPL) indicator shows that ETH often experiences a significant price increase during these moments of heightened volatility.
Specifically, Ethereum responds to sudden drops with rapid recovery movements, with the magnitude of these rebounds varying. In some cases, the price surged by as much as 34%, while the recovery remained more limited in other situations, around 14%.
Since the last FOMC announcement, Ethereum has already risen by 5.35%, indicating a continued positive trend. This strong market sentiment could further propel ETH towards $3800, despite global economic uncertainties.
Additionally, institutional demand for Ethereum is making a comeback. On January 30, the total daily net inflow for Ethereum ETFs reached $67.77 million. BlackRock led the way with a purchase of $79.86 million worth of ETH.
Other notable buyers included Fidelity and Grayscale, with respective purchases of $15.41 million and $12.79 million. The only seller on January 30 was the Grayscale mini-Ethereum trust, which released $40.29 million. The remaining five US spot Ethereum ETFs did not record any inflow.
ETH Breaks Out After Bullish Reversal
On the 4-hour chart, the ETH price trend shows a bullish reversal with a ‘double bottom’ pattern. As predicted earlier, the reversal rally surpassed the 23.6% Fibonacci level at $3248.
The recovery rally also stretched the upper Bollinger band, reflecting a 1.12% increase in the past 4 hours. Now that Ethereum has completed a post-retest reversal at the 23.6% Fibonacci level, the upward trend appears to challenge the overhead resistance trendline. With the rally continuing, the Bollinger bands suggest a potential breakout.
Ethereum Price Expectation
According to Intotheblock’s In/Out of the Money chart, ETH is approaching a crucial resistance zone between $3264 and $3342. This zone contains 6.26 million ETH, making it a high supply area.
Currently, the ‘at the money’ zone holds 7.85 million ETH between $3109 and $3264, indicating a significant level.
On the daily chart, Fibonacci levels highlight critical targets at the 50% and 100% retracement levels, respectively at $3509 and $4079. On the downside, the $3000 support zone is expected to remain strong in the first quarter of 2025.
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