Ethereum (ETH) Testing Liquidity Before The Next Push

Ethereum had an underwhelming 2024, underperforming against Bitcoin and many top altcoins throughout the year.

Ethereum had a lackluster 2024, trailing behind Bitcoin and many top altcoins throughout the year. While BTC soared to new all-time highs, ETH struggled to maintain bullish momentum, leaving investors questioning its market position. However, the upcoming year may present a different narrative, as historical trends indicate that altcoins, including ETH, tend to perform well in the post-halving year.

One key strength of Ethereum is its growing adoption and strong investor hodling behavior. According to key metrics from IntoTheBlock, ETH's hodler ratio has now surpassed BTC's, showing a shift in long-term holding sentiment. This milestone is especially relevant as Bitcoin hodlers have recently been booking profits following BTC's new highs, reducing their market presence.

This dynamic could pave the way for ETH to regain dominance and potentially lead an altseason in 2025. With more ETH being held by committed investors, the supply available for trading is limited, which could serve as a catalyst for price appreciation once demand recovers.

As Ethereum enters a new cycle, the market will be eagerly watching for signals that can drive its recovery and potential breakout in the coming months. Whether ETH can capitalize on these metrics remains to be seen, but optimism for a brighter year ahead is building.

Many analysts and investors are beginning to believe that Ethereum is approaching a potentially dark period after failing to break its yearly highs and continuing to set lower highs. Despite the growing optimism surrounding Ethereum’s long-term potential, the lack of bullish price action has left many questioning its near-term outlook.

Ethereum's price movements have been lackluster compared to Bitcoin and other altcoins, leading some to speculate that ETH could be heading for a more challenging phase in the market.

Top analyst Maartunn recently shared valuable insights on X, revealing that Ethereum’s hodler ratio has surpassed Bitcoin’s. This shift is significant as it highlights that more investors are holding onto ETH for the long term, especially with Bitcoin’s recent profits prompting many hodlers to take their gains. Maartunn poses an important question: Could Ethereum hodlers follow suit when ETH finally breaks its previous all-time highs?

While the outlook for 2025 could be bright for Ethereum, with its growing adoption and the potential for an altseason, there is a risk in keeping the current trend. If ETH fails to break its previous ATH and continues its pattern of lower highs, it could signal a more prolonged consolidation phase or even a deeper correction.

The market sentiment and key data points will be critical in determining whether Ethereum can capitalize on the positive trends in the coming year or face a more challenging road ahead.

ETH Testing Liquidity Before The Next Push

Ethereum is currently trading at $3,390 after several days of consolidation below the key $3,550 level. Price action appears bearish, as ETH has failed to hold this level as support, instead continuing to form a series of lower highs. This ongoing trend suggests that selling pressure is dominating the market, and unless ETH manages to gain strength, the downside could extend further.

However, there is still hope for Ethereum if it can break above the critical $3,750 resistance level. A push above this mark would signal a potential reversal and could set the stage for a strong rally. If bulls can reclaim $3,750 and hold it as support, ETH is likely to see a massive surge, with the potential to reach new highs in the coming weeks.

In the short term, Ethereum's ability to break and hold above $3,750 will be crucial for determining the next major move. If this level is rejected once again, ETH could continue its bearish trend and face deeper corrections. Therefore, investors and analysts will be closely watching for any signs of a breakout to confirm the next direction for Ethereum’s price.

Featured image from Dall-E, chart from TradingView