Ethereum’s price has experienced a significant decline in recent days, facing strong resistance at the $4,000 mark. As of Monday, the cryptocurrency was trading at $3,340, showing a modest recovery from last week’s low of $3,100, as the broader crypto market stabilized.
Seasonal trends suggest a potential rebound for Ethereum in the first quarter of 2025. Historical data from CoinGlass indicates that Ethereum has posted positive returns in nearly every first quarter since 2017, with its most notable surge occurring in 2017, when the price soared by 518%. The cryptocurrency also saw a strong performance in the first quarter of 2021, rising by 160%. On average, Ethereum has delivered a 92% return in the first quarter, making it the best-performing period of the year. In comparison, the second quarter ranks as the next best, followed by the fourth quarter. However, the third quarter typically underperforms, likely due to summer market slowdowns.
Moreover, Ethereum’s price has historically risen in the months following a U.S. presidential election. During Donald Trump’s administration, Ethereum’s average returns in the first four months were about 90%. Similarly, in 2021, following Joe Biden’s election, Ethereum saw a 41% return in the same period.
Despite these trends, it’s important to note that seasonality is not a foolproof indicator of future performance. Ethereum has seen drops in January during the years 2024, 2022, and 2019, and there’s a chance this trend could continue in 2025.
On the positive side, Ethereum continues to show strong fundamentals. Spot ETH exchange-traded funds (ETFs) have seen substantial investor interest, with total inflows surpassing $2.33 billion. The Ethereum network has also generated over $2.44 billion in fees this year, ranking it as the second-most profitable blockchain network, behind only Tether. Dominating the decentralized finance (DeFi) sector, Ethereum currently holds a total value of $66 billion, a figure that surpasses the combined value of the next ten largest chains.
Another potential driver for Ethereum’s price movement is its futures open interest, which has recently dropped to $23 billion, down from a high of $28 billion earlier this year. The last time open interest reached such low levels in November, Ethereum’s price rebounded to $4,000.
Despite the current downturn, Ethereum’s strong fundamentals and historical seasonality trends suggest that a price recovery is possible in the near future.
Related Topics:
