The Ethereum price continues its uptrend following a rejection of the $4,000 resistance level. The bulls are now showing signs of strength, perhaps staging a more sizable rally.
According to TradingView’s 4-hour chart, Ethereum price has been recording lower highs and lower lows within a descending channel since failing to break above the $4,000 resistance level. The cryptocurrency has been climbing back above $3,000 and the channel’s midline, though.
If the market manages to successfully recover to such levels, a break above the channel and a continuation towards $4,000 or even higher prices can be anticipated.
The 4-hour chart offers a much more illuminating picture of the recent price action. The market has barely broken through the $3,000 resistance zone, and is currently testing the midline of the descending channel.
As the RSI shows values above 50%, ETH is likely to break above the level and potentially continue towards the $3,600 resistance area. In such a scenario, market participants may be optimistic that a new bullish wave will begin soon.
Ethereum’s Funding Rates
A significant number of futures traders have been liquidated or their long positions reversed following the recent Ethereum price drop. This could be a good sign, given that the futures market seems to have cooled down.
A chart presented by CryptoQuant shows the Ethereum funding rates metric, which measures whether buyers or sellers are executing their futures orders more aggressively, using market orders. Thus, positive values suggest bullish sentiment, while negative values show bearish trends.
The evidence provided shows that financing rates have decreased significantly, compared to levels a couple of months ago. Low but positive funding rates are usually indicative of a bullish signal, as while the futures market is not overheated, demand continues and the price may soon rise further.
New Ethereum Addresses Retest Record Number
According to data provided by Santiment, Ethereum experienced the highest daily creation of new addresses between May 4 and 5, marking the first time in almost two years.
“Ethereum rebounded back above $3,200 this weekend, and saw massive network growth. 196.71K new addresses were created on the $ETH network on May 4, 2024, the largest single day of growth since October 8, 2022,” Santiment posted yesterday on X.
At the close of business yesterday, the daily new address count had dropped to around 115,000, and declined further to around 33,000 more recently. Such an influx was anticipated, given Ethereum’s previous flirtation with the $4,000 range this year.
The influx of these new addresses likely previews Ethereum’s potential to retest and surpass that price threshold. The last time an influx occurred was in October 2022, and the price of ETH rose months later.
New Ethereum Addresses Not Activated Yet
The number of daily active Ethereum addresses has increased since March. According to the analysis carried out by AMBCrypto, this number has remained constant above 500,000, falling below this threshold only occasionally.
On May 4 and 5, the count was between 560,000 and 556,000, respectively, with no discernible trends observed. The count for May 6 was 536,000. Today the count was around 160,000.
Although this data suggests a healthy level of activity on the network, the recent influx of new addresses has yet to have a significant impact, and therefore they will have to settle for watching from the sidelines for the time being.
By Audy Castaneda
