Will Ether Breakthrough $4,000? Traders Remain Cautious

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Ether has been showcasing incredible performance this bull season. A streak of inflows into the US-listed spot Ether ETFs, the rising activity on the Ethereum blockchain, and the increased institutional interest could all drive Ether to beat its three-year-old price record in the coming months.

QCP Capital Highlights Ether’s Outperformance

“ETH was the main outperformer yesterday as it rallied 11.65% to a high of 3,688. This is aligned with our thesis of capital rotation from BTC to ETH, as shared on Monday,” QCP Capital shared in a Thursday note.

“ETH spot ETFs continue to record strong net inflows, totaling $90.1 million yesterday and marking a 4-day winning streak. These healthy inflows highlight the market’s growing optimism despite this week’s retracement.” it remarked. “Given that ETH has lagged behind BTC and SOL in the current rally, its recent strength supports the case for it to retest its all-time high of 4,868 (+35.4%).”

ETH ETFs Surpass Bitcoin ETF Flows

Notably, The ether ETFs attracted over $220 million in the Nov. 22-27 period, data shows, the second-longest streak of inflows since they went live in July, while spot Bitcoin ETFs tallied $35.2 million in net inflows due mainly to a heavy day of outflows on Nov. 25. 

Notably, data from intotheblock shows that about 88% of Ether (ETH) holders are currently in profit as the crypto asset’s price has risen 6% over the past week, the highest percentage since June.  However, traders are seemingly uncertain about the asset breaking above the $4,000 threshold, with short positions against this level accumulating. CoinGlass data shows much as $1.43 billion of short positions could be liquidated if Ether reaches $4,000.

Market Participants Remain Optimistic

Despite the cautious trading environment, some market participants remain optimistic about Ether’s prospects. Ash Crypto, a crypto trader, in a latest X post shared that Ether is “very close” to reaching $4,000. 

Another trader, Borovik, shared an even higher target, noting that he would get an Ether logo tattoo if the cryptocurrency hits $15,000 this cycle.

A pseudonymous analyst recently shared that Ethereum (ETH) is poised to rally in both its Bitcoin (ETH/BTC) and US dollar pairs. He claims that ETH/BTC may bounce to as high as 0.4597 BTC. As for Ethereum against the dollar, Pentoshi believes that it is within the realm of possibility for ETH to surge above $4,000.

He also believes that the rally will be driven by investors allocating hundreds of millions of dollars in capital to ETH ETFs. “We could see a few $250-$500 million days at some point too in the near future for this [BlackRock ETH] ETF. Had a $91 million day just in the last week,” he noted. 

Ether Set For A Rally

Over the past seven days, Ethereum has increased 7.7% to $3,590 while Bitcoin BTC has fallen 2% to $96,780, bringing the ETH to BTC price ratio back up to 0.037 BTC. Markus Thielen, 10x Research founder, said crypto privacy mixer Tornado Cash’s partial court victory likely contributed to Ethereum’s price rally as it is the dominant decentralized finance (DeFi) chain.

Ether’s price is all poised for more upward momentum based on growing investor interest and expectations of positive crypto regulations leading into 2025, which could set it up for a rally above $4,000. The market looms between bullish sentiments and cautious trading positions. What do you think? Will Ether break through the resistance level or a price correction awaits? Stay tuned.