Ethereum (ETH) has been struggling to break through the $4,000 mark for quite some time now. Despite multiple attempts, the cryptocurrency has failed to surpass this key resistance level since March 2024. Currently trading at $3,475, ETH has experienced a 24% drop in the past few days, indicating a lack of bullish momentum in the market. So, what factors are contributing to Ethereum’s inability to break the $4,000 wall?
### Why Can’t Ethereum Break the $4,000 Wall?
For Ethereum, the $4,000 level has proven to be a significant barrier. Every time ETH approaches this price point, it faces strong selling pressure, causing the price to retreat. Although Ethereum recently dropped to $3,097, it has managed to recover to $3,475. However, the overall market sentiment remains weak, with trading volume declining by nearly 15%. The relative strength index (RSI) currently stands at 52.64, indicating a neutral market sentiment with limited price action. While the 20-day moving average is providing some support for ETH above $3,400, breaking through the $4,000 barrier continues to pose a challenge.
### ETFs Aren’t Helping Ethereum’s Case
The launch of Ethereum spot ETFs in August was met with high expectations, but they have not had the desired impact. The total value of U.S. spot ETH ETFs stands at around $11.98 billion, significantly lower than Bitcoin’s $109.66 billion in ETFs. Recent data shows that $60 million was withdrawn from ETH ETFs, marking the largest outflow since mid-November. Additionally, social sentiment surrounding Ethereum is currently at its lowest point in a year. However, such negative sentiment levels often precede a potential price rebound in the near future.
### Troubles in the Futures Market
The futures market for Ethereum is also displaying concerning signs. Ethereum futures are currently trading at a negative premium for the first time since early November, indicating bearish sentiment among traders. Moreover, a substantial $299 million sell-off occurred recently, marking the largest sell-off since December 9. The Ethereum Foundation’s sale of 100 ETH on December 17 has raised further apprehensions, as sell-offs near local price highs are typically seen as a red flag.
### Can Ethereum Make a Comeback?
Despite the current challenges, there is still hope for Ethereum’s price recovery. The recent 12% bounce from its recent low suggests a potential short-term uptrend. However, analysts’ opinions are divided, with some expecting a positive sentiment shift to drive ETH higher, while others remain cautious due to the high supply of ETH and the increasing preference for Bitcoin among investors.
Stay informed with the latest developments in the crypto world by subscribing to breaking news, expert analysis, and real-time updates on Bitcoin, altcoins, DeFi, NFTs, and more. Ethereum’s journey to break through the $4,000 wall continues, and only time will tell if it can overcome this significant resistance level.