Ethereum (ETH) has entered a critical phase as the second-largest cryptocurrency experienced a sharp 7% decline on Thursday, testing the $2,400 support level. However, multiple on-chain metrics and expert analyses suggest a potential bullish breakout could be imminent.
Key On-Chain Metrics Signal Accumulation Phase
Renowned crypto analyst Lark Davis has identified several bullish indicators that point to growing institutional interest in Ethereum. According to his analysis shared on X (formerly Twitter), exchange balances have hit seven-year lows while ETH ETF inflows continue to surge, suggesting significant accumulation by larger investors.
As noted in our recent coverage of Ethereum price predictions from Myriad Markets traders, institutional sentiment remains largely optimistic despite short-term volatility.
Technical Analysis and Price Outlook
Market analyst Income Sharks has identified $2,390 as a crucial support level that could determine Ethereum’s next major move. If this level holds, potential upside targets include:
- First resistance: $3,000
- Secondary target: $4,000
- All-time high: $4,878 (50% above current levels)
Fundamental Catalysts Supporting Bullish Outlook
Several key developments support the potential for an Ethereum price recovery:
- The recent Pectra upgrade improving scalability
- Reduced inflation rate enhancing tokenomics
- Strong Q2 performance versus Bitcoin
- Growing ETF inflows indicating institutional adoption
Market Context and Political Factors
The broader crypto market has faced pressure, with total market capitalization dropping from $3.30 trillion to $3.12 trillion. Adding to market uncertainty, tensions between former President Trump and Elon Musk have emerged as a potential source of volatility.
Frequently Asked Questions
What is Ethereum’s current support level?
The critical support level is at $2,390, with current trading around $2,406.
What are the key bullish indicators for ETH?
Seven-year low exchange balances, increasing ETF inflows, and strong Q2 performance versus Bitcoin.
When could Ethereum reach a new all-time high?
While betting markets show only a 27% probability of reaching new highs by 2025, technical indicators suggest potential for significant upside if current support levels hold.
