Ether’s (ETH) recent price action mirrors patterns observed during the early August bottom, suggesting a possible resurgence in bullish momentum in the months to come.
Since mid-December, Ether has faced a significant decline of 32%, falling to approximately $2,770. During this period, it has notably lagged behind its larger counterpart, Bitcoin (BTC). The volatility reached unprecedented levels last Monday, with prices dropping to nearly $2,000 across several exchanges before rebounding sharply to $2,700, marking the largest single-day fluctuation since September 2021.
This dramatic two-way price movement has led to a notable increase in trading volumes on platforms such as Coinbase (COIN) and Bitstamp, hitting levels not seen since August. Such a spike indicates that selling pressure may have peaked at the beginning of the week, which could result in fewer sellers remaining in the market. This scenario may assist in stabilizing prices, thereby potentially laying the groundwork for a rally.
Interestingly, a similar pattern was observed on August 5, when ETH dropped to around $2,100 amidst large trading volumes. Following this, the cryptocurrency stabilized within the $2,200-$2,800 range for several weeks before entering a new upward trend that saw prices soar to $4,100.
The current demand during last Monday’s dip strengthens the bullish prospect. “I am noting strong over-the-counter demand for ETH, which is particularly noteworthy amid broker chatter surrounding a fund navigating difficulties during weekend volatility,” remarked Jake Ostrovskis, an OTC trader at the crypto market maker Wintermute, in his comments to CoinDesk on Tuesday.
Moreover, U.S.-listed spot ether ETFs have reported net inflows amounting to $420 million this week, which constitutes nearly 13% of the total $3.18 billion inflow since their inception, according to Farside Investors.
As if this weren’t compelling enough, a substantial bull call spread was observed on Deribit this week. This strategy involves a long position in the $3,500 call option, alongside a short position in the $5,000 call option, both set to expire on December 26, 2025. This approach aims to capitalize on a potential rally to $5,000 or above by year-end.
As we stand at this critical juncture, the market will be closely watching to see if history indeed repeats itself.
