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Ethereum Struggles Below $3.5K: Accumulation Soars, Signaling Potential Breakout Ahead

Since the beginning of 2025, Ethereum (ETH) has faced challenges in maintaining its upward momentum. After reaching a high of $3.7k, ETH has since dropped below the $3k mark. As of writing, Ethereum is trading at $3,215, reflecting a 3.21% drop on daily charts and a 4.57% decline on weekly charts. Despite this recent bearish outlook, the market remains optimistic, with many seeing this as an opportunity to accumulate ETH.

Ethereum Accumulation Surge: Investors Bet on Recovery

According to CryptoQuant, Ethereum accumulation has soared in recent weeks, signaling growing confidence in its future prospects. Despite market volatility, investors are actively acquiring ETH, suggesting a bullish sentiment despite short-term price fluctuations. Notably, futures market participants have ramped up their positions, with Ethereum’s leverage ratio seeing a significant rise. This increase in leverage indicates a growing appetite for high-risk, high-reward positions within the derivatives markets.

Source: CryptoQuant

A Potential Breakout on the Horizon

Ethereum’s current consolidation range between $3.5k and $3k presents a potential breakout opportunity. The elevated leverage ratio and ongoing accumulation suggest that if ETH breaks above its resistance levels, a sharp upward price move could follow. Investors are displaying bullish behavior, particularly as they perceive Ethereum to be undervalued at its current price, with many holding on to their positions in anticipation of higher future returns.

Ethereum’s Stock-to-Flow Ratio and Market Scarcity

Source: Santiment

Ethereum’s stock-to-flow (SFR) ratio has surged from 6.87 to 67.57, signaling increased scarcity of the asset. This rise suggests that ETH is being moved off exchanges and into cold storage, further bolstering the bullish outlook. When scarcity increases and demand remains steady or rises, the price typically follows suit.

Source: Santiment

With heightened accumulation and positive sentiment, Ethereum is positioned for a potential breakout. If the current market trend persists, ETH could reclaim the $3,450 level and break through the $3,500 resistance. However, if bulls fail to push past these levels, Ethereum could dip back to $3,000, testing critical support once again. The next few weeks will be crucial in determining whether Ethereum can break free from its consolidation range and embark on a sustained upward rally.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.

Also Read: Vitalik Buterin’s Bold Move: Ethereum’s Push for Wall Street Dominance with Etherealize

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