Three key factors that have the potential to drive Ethereum to new heights are:
1. Decreasing exchange supply: Despite recent price increases, the supply of Ethereum on exchanges continues to decline. This suggests that long-term holders of Ethereum are holding onto their positions in anticipation of higher price rises and a new all-time high. This trend may continue as more Ethereum is locked up in staking protocols, further reducing the available supply on exchanges.
2. Inflows from spot Ethereum ETFs: The launch of spot Ethereum ETFs could attract significant inflows into the market. Galaxy Research predicts that these ETFs could bring in up to $5 billion within their first month of trading. The potential for inflows from ETFs is especially important for Ethereum, as its price is expected to be more sensitive to such inflows compared to Bitcoin. However, the report also notes that potential outflows from other investment vehicles, such as Grayscale’s Ethereum Trust, could impact Ethereum ETF inflows.
3. Overcoming key resistance levels: Ethereum needs to surpass the $3,629 resistance level to validate a bullish thesis. This level has proven to be a significant barrier for ETH bulls in recent weeks, with multiple failed attempts to sustain a move above it. However, a successful sustained move above this level could pave the way for further price growth, with the next resistance level at $3,829. On the other hand, a drop below the $3,300 support level could lead to further downside, but the key support at $3,203 could prevent a significant decline.
Overall, these factors indicate a positive outlook for Ethereum’s price and potential for growth in the future.