Ethereum (ETH) has recently sparked significant attention in the crypto market by rising sharply over a span of two trading days. Breaking past the crucial resistance level of $4,000 for the first time since December 2024, Ethereum’s momentum has only intensified, reaching $4,200 on Binance on the morning of Saturday, August 9. Currently, Ethereum is trading around $4,165, showing an approximate 6.57% increase in just 24 hours.
What Is Driving Ethereum’s Surge?
A confluence of technical developments and enhanced trading volumes is credited for this Ethereum rally. Analyst Miles Deutscher remarked that nearly $207 million in short positions were liquidated in the past day, contributing to the price leap. He emphasized the “on-chain wealth effect” that has bolstered both prominent and small-scale investors within the Ethereum domain.
According to Deutscher, a market rotation comprising three phases is underway. It is anticipated that altcoins led by Ethereum will rise initially, succeeded by a transition towards Bitcoin with targets between $120,000 and $140,000. The cycle is expected to conclude with a renewed focus on Ethereum and smaller cryptocurrencies.
How Are Analysts and Investors Reacting?
Michaël van de Poppe, a well-known cryptocurrency analyst, referred to Ethereum’s climb to $4,200 as a “crazy move” and warned about the risks of buying at these elevated levels. He suggests that while Ethereum might hit record highs, selective Ethereum projects could see better returns.
“The usage of terms like ‘buy’ and ‘positive’ are now double in frequency compared to ‘sell’ and ‘negative’ leading to potential market pauses due to overconfidence,” remarked Santiment, an on-chain analysis firm.
CoinDesk Research has reported that Ethereum jumped approximately 6% between August 8, GMT 07:00, and August 9, GMT 06:00. Prices ranged from $3,914.59 to $4,160.29 during this time, even surpassing $4,000 by 1:00 PM amid high trading volumes.
– Ethereum surged approximately 6% in a 24-hour window.
– Trading volumes nearly tripled, as seen with over 646,459 ETH transacted.
– Price fluctuations peaked between $4,157.33 and $4,194.53 in the final hours of trading.
Profit-taking activities ensued following this rapid price escalation, with prices stabilizing just beneath the critical $4,200 benchmark. Experts indicate that the range of $4,155 to $4,160 could function as a short-term support level amidst this bullish trend.
