- Ethereum’s comeback puts the $4K target back in sight.
- Derivate market reinforces bullish sentiment for ETH.
After a grim ending to 2024, things are finally looking up for Ethereum [ETH] as a key metric has hinted at a potential turnaround.
The Taker Buy Sell Ratio, a pivotal indicator for gauging sentiment in the futures market, has shown a significant uptick.
For context, this metric measures the aggressiveness of buyers versus sellers in executing market orders.
According to CryptoQuant data, the recent increase in the ratio indicated a surge in market buy orders within the futures market.
This development points to heightened bullish sentiment, with participants anticipating Ethereum’s price to challenge the critical $4,000 resistance level.
Why is this happening?
Now, the important question here is what caused the metric to surge? AMBCrypto’s analysis of Ethereum’s daily chart provided some answers.
The ratio spiked as ETH’s price rebounded and surpassed the 20-day EMA around the $3,500 mark.
After a late December rejection at this resistance, the price stumbled below the 20 and the 50 EMA to $3,300, where it briefly stabilized before surging.
Nonetheless, a bullish rebound near this support propelled the metric upwards.
Notably, ratio values exceeding 1 indicate that buyers are dominating, often marking the beginning of a bullish trend. This recent uptick reinforces the growing optimism in the altcoin’s price trajectory.
Source: TradingView
Furthermore, this price rally has tipped the scales in favor of the bulls. This is evident from the Relative Strength Index (RSI), which moved above the 50 line and was recorded at 56.12 at press time.
However, the Chaikin Money Flow (CMF) remained slightly negative at -0.03, signaling that capital inflows have yet to pick up significantly.
As of this writing, ETH was trading at $3,632, reflecting a 7.45% gain over the past week. This upward movement underscores the market’s renewed confidence in Ethereum’s near-term potential.
Derivatives market analysis
Meanwhile, data from Coinglass painted a similarly optimistic picture for Ethereum. Open Interest rose by 2.82%, and the Funding Rate remained positive, indicating favorable conditions for long positions.
The Long/Short ratio over the past 24 hours stood at 1.0218, reflecting a slight tilt toward buyers. Yet, trading volume dipped by 22.02%, suggesting that while sentiment was bullish, market participation could improve.
Will Ethereum reach $4,000?
Here, it is worth noting that ETH’s previous breakout over the $3,500 resistance in late November 2024 was succeeded by a swift climb to $4,000. Ergo, the question: Will history repeat itself?
Well, AMBCrypto’s recent analysis highlighted that Q1 has traditionally been Ethereum’s best-performing quarter. Notably, January and March have historically delivered strong returns.
Read Ethereum [ETH] Price Prediction 2025-2026
Thus, if the current trend continues, Ethereum could reach $3,800, $4,000, or even higher in the coming weeks.
Nonetheless, a bullish outlook hinges on ETH maintaining support above $3,500. A breach below this level could invalidate the positive sentiment and put the recent gains at risk.
