Ethereum price has embarked on a strong bull run this month, surging over the past ten consecutive days and nearing the key resistance level of $4,000. It has jumped by over 170% from its lowest point in April.
The ETH price has jumped due to ongoing demand from Wall Street investors, who have driven the net inflow to nearly $8 billion today. This is a significant development, as these ETFs had struggled to surpass the $5 billion mark for months.
Additionally, the Ethereum price has surged because of its dominant position across various industries within the crypto sector, including decentralized finance (DeFi), stablecoins, and real-world asset tokenization. Its DeFi network has over $185 billion in total value locked, accounting for 66% of the market share.
Ethereum’s stablecoin supply has jumped to over $130 billion, significantly higher than other chains like Tron, Solana, and BSC. It also has a substantial market share in the RWA industry. Its RWA assets have increased to over $7.2 billion, surpassing ZKsync Era, which has over $2.3 billion.
ETH price is also soaring as the anticipation of the Fusaka upgrade rises. Fusaka will be launched in November and aims to enhance its scalability on layer-2 networks, including Arbitrum, Optimism, and Base. It will be a build-up to the Pectra upgrade that improved its staking mechanisms.
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Ethereum Price Technical Analysis
ETH price chart | Source: TradingView
The daily timeframe shows that the ETH price has surged from a low of $1,375 on April 9 to $3,860 today, as bulls attempt to reach the key resistance point at $4,000.
Still, there are reasons why the coin may be on the verge of plunging back to $3,000 this week. First, as the chart above shows, the Ethereum price has become highly overbought, with the Relative Strength Index (RSI) soaring to 87, the highest level this year.
The Stochastic Oscillator has moved to nearly 100, meaning that it is highly overbought. The same is true for other indicators, such as the Money Flow Index (MFI) and the Commodity Channel Index.
Furthermore, the coin will likely crash due to a phenomenon known as mean reversion. This is a situation where an asset often returns to its historical averages after experiencing a significant divergence. In this case, the ETH price is at $3,700, while the 50-day moving average is at $2,800, and the 200-day average is at $2,570.
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