Ethereum (ETH) is poised for a significant rally that could push its price as high as $6,000 in the first quarter of 2025, according to leading analysts. The cryptocurrency has seen a dramatic rise in long-term holders throughout 2024, signaling strong investor confidence.
Bullish Patterns Emerge
CryptoBullet, a prominent analyst with over 152,000 followers, highlighted on Dec. 29 via X (formerly Twitter) that Ethereum is forming a bull pennant pattern on the 1-day ETH/USDT chart. This technical pattern, typically signaling a continuation of an uptrend, could propel ETH to $6,000 in the coming months. He compared the current setup to May 2021, when Ethereum surpassed $4,000 after a similar formation.
James CryptoGuru, another analyst, echoed these sentiments, forecasting a potential rally to $8,100. He based this projection on a multi-month inverse head and shoulders pattern that ETH has been developing throughout 2024. This pattern is expected to complete by early 2025, setting the stage for a potential breakout.
Meanwhile, analyst Jelle pointed to a breakdown in Bitcoin’s dominance—a multi-year trend reversal—as a catalyst for Ethereum’s growth. Jelle noted that in a previous instance of such a breakdown, Ethereum’s price quadrupled in just five months.
Investor Trends and Catalysts
The optimism surrounding Ethereum aligns with a marked increase in long-term holders. Data from IntoTheBlock reveals that the percentage of ETH held for over a year surged from 59% in January to 75% by the end of 2024. By comparison, Bitcoin’s long-term holder rate fell from 70% to 62% during the same period.
Historical trends could also bolster Ethereum’s prospects. CoinGlass data shows that Ethereum’s best-performing quarters historically align with the first quarters following U.S. elections and Bitcoin halving cycles, such as in 2017 and 2021, when ETH posted gains of 518% and 161%, respectively.
Additionally, the introduction of spot Ether exchange-traded funds (ETFs) has been a significant growth driver. These ETFs have attracted inflows on 22 of the last 24 trading days, accumulating over $2.5 billion, according to SoSoValue. One analyst predicted that by 2025, Ether ETFs could bring in more than $50 billion in net inflows.
Potential Headwinds
Despite the bullish outlook, Ethereum faces challenges. Data from IntoTheBlock shows a sharp decline in whale net inflow, with large holders reducing their positions from 220,880 ETH (valued at $737 million) on Dec. 23 to just 14,450 ETH ($48 million) by Dec. 28. This drop could signal waning confidence among major investors and might influence retail sentiment, which often mirrors whale activity.
At press time, Ethereum was trading at $3,413, up 1% for the day. As Q1 2025 approaches, all eyes remain on whether Ethereum can sustain its momentum and overcome potential obstacles to reach new heights.
Related Topics:
