Ethereum has had a disappointing performance in 2024, underperforming against Bitcoin and several major altcoins throughout the year. While Bitcoin rose to all-time highs, Ethereum struggled to regain its upward momentum, leaving investors questioning its standing in the market. However, next year could tell a different story, as historical trends suggest that altcoins, including ETH, tend to shine during the post-halving year.
One of Ethereum’s strengths is its growing adoption and strong investor base. According to key metrics from IntoTheBlock, ETH’s holding ratio has surpassed that of BTC, indicating a shift in long-term holding sentiment. This achievement is especially notable as Bitcoin holders have recently taken profits following BTC’s new highs, reducing their market share.
This dynamic could pave the way for ETH to regain dominance and lead a potential replacement season in 2025. As committed investors hold more ETH, the supply available for trading is limited, which could serve as a catalyst for higher prices once demand returns.
As Ethereum enters a new cycle, the market is eagerly watching signals that could drive its recovery and potential breakout in the coming months. It remains to be seen whether ETH can benefit from these metrics, but optimism for a brighter year is growing.
Is Ethereum losing steam?
Many analysts and investors have begun to believe that Ethereum is approaching a potential dark period after it struggled to break its yearly highs and continues to set lower highs. Despite the growing optimism surrounding Ethereum’s long-term potential, the lack of upward price action has left many questioning its near-term outlook.
Ethereum’s price movements have lacked in comparison to Bitcoin and other altcoins, leading some to speculate that Ethereum may be heading into a more challenging phase in the market.
Chief Analyst Martin recently Share valuable insights about XWhich reveals that the Hodler ratio in Ethereum has exceeded that of Bitcoin. This shift is important because it highlights that more investors are holding ETH for the long term, especially since Bitcoin’s recent gains have led many holders to cash in their gains. This prompted Martin to ask an important question: Could Ethereum traders follow suit when ETH finally breaks its previous all-time highs?
While the outlook for 2025 may be bright for Ethereum, with its increasing adoption and the potential for an alternative alternative, there is risk in maintaining the current trend. If ETH fails to break the previous ATH and continues its pattern of lower highs, this could indicate a longer consolidation phase or even a deeper correction.
Market sentiment and key data points will be crucial in determining whether Ethereum can benefit from positive trends in the coming year or face a more difficult road ahead.
ETH tests liquidity before the next payment
Ethereum is currently trading at $3,400 after several days of consolidation below the key $3,550 level. The price action looks bearish, as ETH failed to hold this level as support, instead continuing to form a series of lower highs. This ongoing trend indicates that selling pressure is dominating the market, and unless ETH can regain its ground, the downside may extend further.
However, there is still hope for Ethereum if it can break the critical resistance level of $3,750. A rise above this mark would signal a potential reversal and could set the stage for a strong rally. If the bulls can reclaim the $3,750 level and hold it as support, ETH is likely to see a massive rally, with new highs likely to be reached in the coming weeks.
In the short term, Ethereum’s ability to break and hold above the $3,750 level will be crucial to determining the next major move. If this level is rejected again, ETH may continue its downtrend and face deeper corrections. Therefore, investors and analysts will be closely monitoring any signs of a breakout to confirm the next direction for the Ethereum price.
Featured image by Dall-E, chart from TradingView
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