Ethereum has reached a significant milestone by breaking a multi-year downtrend against Bitcoin. This event may indicate a new phase in the cryptocurrency market.
Trend Break
Ethereum (ETH) has made a noteworthy breakthrough by overcoming a multi-year downtrend against Bitcoin (BTC). According to CryptoBusy, ETH has managed to break a long-standing resistance trendline, a phenomenon not seen since 2021. This achievement has been made possible by strong bullish momentum, supported by technical analysis indicating the potential to reach higher Fibonacci levels.
Data and Institutional Interest
This technical breakout is corroborated by data. According to Santiment’s latest metrics, ETH's exchange supply has fallen below 4.9%, a level last observed during Bitcoin's 2021 bull run. This suggests significant accumulation by long-term holders and institutional investors. Additionally, reports from CoinShares indicate five consecutive weeks of positive ETF inflows into ETH, injecting fresh capital into the ecosystem.
Risks and Future of Ethereum
Despite the optimism, analysts caution about potential risks associated with profit-taking or a failed retest of the breakout level that could lead to volatility. The resistance zone at $3,700 remains a critical hurdle. If ETH holds above this trendline, there are opportunities to reach $4,000 or higher, potentially triggering a parabolic rally. The shifting market dynamics toward ETH could accelerate innovation in the DeFi and NFT sectors, drawing more builders and capital into the Web3 space.
Ethereum's breakout from a multi-year downtrend signals changing market dynamics and may lead to significant innovations in the cryptocurrency space.
