Ethereum Price Eyes $3,760 Breakout as Traders deploy $1B Leverage

by

On January 5th, the cost to trade Ethereum reached a 18-day high of $3,650 at the start of trading on Sunday. Data from derivatives markets suggests that ETH traders are increasing their long positions with higher leverage, indicating they expect further price increases in the coming week.

Ethereum price advances above $3,600 as traders brace for more bullish action

2025 saw Ethereum’s price steadily rising, following the general trend of crypto market recovery. However, unlike Solana (SOL), Cardano (ADA) and Avalanche (AVAX), which saw gains over 20%, Ethereum’s growth was more moderate. This could be due to a recent outflow of $32.4 million from Ethereum-based ETFs in the past week, potentially hindering its price surge.

Even with weak interest in ETFs, the value of Ethereum climbed significantly last Sunday, propelling its year-to-date growth into double digits. As depicted in the accompanying graph, Ethereum started trading on January 4 at $3,656, representing a 11% rise from its 2021 starting price of $3,310.

Bull traders deploy $1B leverage as crypto rally enters Day 5

After surpassing the psychological barrier at $3,600, recent trends in the derivatives market suggest a substantial increase in investor confidence. Bold Ethereum buyers are engaging in active trading, which suggests a broad anticipation of further price increases in the coming week.

According to the graph provided by Coinglass (referred to as the “Liquidation Map”), it shows how the worth of long positions compared to current short contracts fluctuates. This offers immediate insight into the short-term trading attitudes of swing traders.

The graph indicates that traders who believe the price of ETH will rise (bulls) have taken out long position contracts for approximately $1.09 billion at the current prices. On the other hand, traders who anticipate a drop in ETH’s value (short sellers) have opened short futures contracts worth around $835 million, which is about 30% less compared to the bullish positions.

The significant difference shows an extremely optimistic outlook from speculative investors, who believe that Ethereum’s current surge will carry on for the upcoming week.

Due to aggressive trading strategies by bull investors in the derivatives sector, there is an increased motivation for quick spot transactions. As these bulls aim to boost their earnings, they might push ETH prices closer to $3,700 within the coming week.

ETH Price Forecast: $3,700 Resistance Looms Large amid Slow ETF Demand

The rise in ETH’s price back to $3,650 has bolstered the faith of short-term traders, evident by the increased activity of buyers in derivative markets. Yet, if demand for Ethereum ETFs continues to be weak, the bulls may find it challenging to push past the $3,700 resistance, potentially causing trouble for over $1.09 billion worth of long positions and leading to possible liquidations.

Based on current short-term predictions, the Parabolic Stop and Reverse (SAR) and Bull-Bear Power (BBP) technical markers on the Ethereum daily graph suggest a possible surge in price, potentially reaching around $3,750.

When the Parabolic Stop and Reverse (SAR) line drops beneath the current Ethereum (ETH) price, it signifies strong buying activity, potentially paving the way for ETH to surge past its upcoming major resistance at $3,760. This bullish trend coincides with the upper boundary of the Bollinger Band, suggesting a likely breakout in line with expectations.

Over these last four trading days, the Bull-Bear Power (BBP) has shown a growing preference towards bullishness, with consistently favorable results.

The analysis using Bollinger Bands shows that $3,760 represents a significant resistance point, being equal to the upper band’s location. Meanwhile, $3,464, close to the middle band, functions as immediate support. If Ethereum manages to finish with a positive close above $3,760, it could potentially lead to testing the level of $3,850.

If the current upward trend does not continue, there could be a reversal leading back towards the level of $3,464. Breaking through this support might lead to additional drops reaching $3,168.

When ETH ETFs are experiencing a decrease in investment, it’s advisable for strategic investors to pay close attention to the significant levels of $3,760 and $3,464. These points might indicate changes in the immediate market sentiment.

Read More

2025-01-05 13:30