$3K retracement remains in play if ETH ‘keeps coming back’ – Analyst

As Ethereum price continues to struggle to hold above the $4,000 price level, it may remain as a range between two key psychological levels in the near term, a crypto analyst said.

“Ethereum continues to struggle with $4000 psychological resistance,” said anonymous crypto trader Rect Capital in a December 20 market report. In the past 30 days, Ether has risen above $4,000 several times, reaching a high of $4,077 on December 6, but has not been able to hold the price level, according to CoinMarketCap data.

ETH can be summarized between 2 psychological levels.

According to Rect, $3,000 is now “psychological support” for Ether (ETH), a level Ether last touched on November 9th. Prior to that, Ether had been trading below $3,000 since August 3rd.

Rect said that Ether could rally between $3,000 and $4,000 in the near future. However, the current price of $3,466 could drop by more than 10% in the short term and approach the $3,000 range, he added.

“Of course it's worth watching if ETH can form a bottom in that area and area because that creates the right shoulder for a general reversal head and shoulders formation,” Recht said.

A head and shoulders pattern is a reversal pattern that can indicate a change in trend direction. Analysts are pointing to a variety of factors, including a lack of supply of Ethereum on crypto exchanges and the influx of Ethereum exchange-traded funds (ETFs) as catalysts for the strong price advance.

On December 17, Cointelegraph reported that data from the onchain market intelligence firm CryptoQuant showed that ETH transactions reached an 8.5-year low of 9.2 million ETH, a decrease of about 10% compared to last year.

Meanwhile, some analysts hope that Ether ETFs will surpass Bitcoin ETFs by 2025 as the flow rate continues to increase.

Analysts expect Ether ETF growth to continue.

Since its launch in the United States on July 23, the SpotEther ETF has withdrawn a total of about $2.43 billion, according to Farside data.

Analysts expect this growth to continue through 2025, especially if regulators allow the fund to earn from stock yields.

Asset manager VanEyck estimates that Ether's spot price will reach $6,000 in the fourth quarter of 2025.

RELATED: Ethereum Has Less Than 10% Chance of Touching $5K By Year-End, Derive Says

When the Spot Ether ETF launched in July, there was optimism among crypto market participants that Ether could perform similarly to Bitcoin following the launch of spot Bitcoin ETFs in January.

However, the relatively weak initial earnings made Ether's all-time high and expectations of reaching $5,000 by the end of the year seem unlikely.

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