Este artículo también está disponible en español.
The sentiment surrounding Ethereum (ETH) has dipped to its lowest levels in a year as the second-largest cryptocurrency by market capitalization struggles to break through the $4,000 mark. Despite the prevailing investor sentiment, some analysts are optimistic that the leading altcoin is on the verge of initiating a bullish trajectory towards new all-time highs.
Related Reading
Ethereum Sentiment Hits Yearly Low
According to crypto analyst Ali Martinez, social sentiment surrounding Ethereum has reached a one-year low amidst its challenges in converting the $4,000 resistance into a support level. Martinez highlighted that this metric is currently at its most negative point since December 18, 2023, when ETH was trading in the range of $2,100 to $2,200.
Martinez suggested that this dip in sentiment could be viewed as a classic bullish indicator. He pointed out that a year ago, when sentiment hit rock bottom, Ethereum’s price surged by approximately 30% in the weeks that followed. This rally propelled the cryptocurrency to the $2,700 mark by January 12, a crucial milestone in ETH’s climb to its peak of $4,093 in March.
If Ethereum follows a similar pattern, it could potentially experience a surge towards the $4,900 to $5,000 price range in the coming month, potentially transforming the next significant resistance level into a supportive one within the subsequent two weeks.
Martinez further elaborated that Ethereum’s bullish momentum is likely to resume once it surpasses the $4,100 resistance level, which has not been breached since December 2021. Once this hurdle is overcome, the analyst believes that $6,000 will become a magnetic target for the cryptocurrency.
Despite making attempts to surpass the $4,000 threshold this month, Ethereum has faced challenges in consolidating this level as support. The most recent breakout endeavor occurred earlier in the week when Bitcoin surpassed its previous all-time high.
While Bitcoin was trading above the $107,000 range, Ethereum briefly spiked to $4,100 before retracing to $3,900 and then correcting to the $3,800 level. Despite these fluctuations, ETH has still shown gains in both weekly and monthly timeframes, with a 2.3% increase for the week and a 22.6% increase for the month.
Will Ethereum Surpass $4,000 This Month?
Altcoin analyst Sherpa noted that Ethereum is currently positioned at a level similar to where Bitcoin was at around $70,000, a level that Ethereum has struggled to breach significantly in recent years. Although ETH has been rejected from the $4,000 mark multiple times over the past three years, it reached its all-time high in 2021 after consolidating around this level.
If Ethereum mirrors Bitcoin’s performance, it could potentially rally to its previous all-time high of $4,800 before setting its sights on a new price discovery target of around $5,000. Sherpa also highlighted that December and January historically mark the best periods for the performance of the altcoin market.
Similarly, analyst Benjamin Cowen previously pointed out that Ethereum’s pairing against Bitcoin tends to exhibit renewed strength between December and January, following a familiar pattern.
However, Sherpa forecasted that the ETH/BTC pair might experience one final shakeout before embarking on an upward trajectory for a few weeks or months. To achieve this, Ethereum must break past its recent high of 0.041.
Trader and analyst Skew cautioned that surpassing the $4,000 resistance level would require a significant influx of buying pressure, as there are substantial sellers continuously adding to the supply at this price point. He emphasized that maintaining the $3,800 level is crucial for sustaining the ongoing rally.
At the time of writing, Ethereum is trading at $3,874, reflecting a 2% decline in the daily timeframe.
Featured Image from Unsplash.com, Chart from TradingView.com