Ethereum (ETH) Price Analysis: Hopes Rise for Fresh Liquidity Inflow as Gold Price Rallies to New All-Time High

As Gold price rallied to a new all-time high earlier on Monday during the Asian session, of about $2,898 per ounce, the hopes for fresh and new liquidity

Gold price hit a new all-time high earlier on Monday during the Asian session, of about $2,898 per ounce. Hopes for fresh and new liquidity inflow to the altcoin industry, led by Ethereum (ETH), have increased.

Last week's initial crypto bearish sentiment significantly subsided over the past few days, with Bitcoin price forming a potential reversal pattern, which could trigger a fresh bullish sentiment.

With most of the altcoins still heavily undervalued in Bitcoin's perspective, a parabolic rally of the 2025 crypto bull rally is likely to happen in the near future.

According to a market research report from The Kobeissi Letter, the short positioning, catalyzed by Wall Street hedge funds, surged by more than 40% last week, based on the CFTC CME Ether cash leveraged net totals. Interestingly, the net short positioning in Ethereum has surged by more than 500% since November 2024

The recent post by Eric Trump, VP of the Trump Organization, that now is a great time to add Ether to crypto portfolios has increased the trading activity of the altcoin industry.

In the weekly time frame, Ethereum price, against the US dollar, has been consolidating in a horizontal channel ranging between $2,200 and $4k since March 2024. The large-cap altcoin, with a fully diluted valuation of about $318 billion and a 24-h average trading volume of around $20 billion, must hold above the support range between $2,200 and $2,622 to invalidate potential selloff to $1,500.

Nonetheless, the bullish sentiment for Ether is heavily bolstered by mainstream adoption by institutional investors. The increasing short positioning of Ether by Wall Street's hedge funds will trigger the largest short squeeze in the history of altcoins.

In case Ether's price consistently closes above the support/resistance level around $3,500 in the near term, all the short positions will run long and fuel a major bull rally.

The Ethereum network remains the dominant player in the decentralized financial (DeFi) ecosystem, amid the emergence of highly competitive Layer One (L1) chains, led by Solana (SOL). According to market data provided by Defillama, the Ethereum network had a total value locked of about $56 billion and a stablecoins market cap of around $121 billion at the time of this writing.

Remarkably, Ether's TVL is higher than the next four largest smart contract chains.

Meanwhile, the Ethereum network has significantly benefited from the mainstream adoption of digital assets by institutional investors. As Coinspeaker pointed out, the rate of cash inflow to US spot Ether ETFs has increased recently, thus increasing the cumulative total net inflow to $3.18 billion.