Ethereum (ETH) rose over 5% in the past 24 hours, fueled by Bitcoin’s recent surge past $71,000. This price action saw Ethereum trade around $2,618 on Tuesday, October 29, marking a significant comeback for the leading altcoin. As trading volumes climbed to an average of $23 billion daily and its fully diluted valuation reached an impressive $315 billion, Ethereum appears poised for a breakout. The heightened volatility led to approximately $40 million in liquidations in Ethereum’s leveraged markets, with short traders taking the brunt—81% of the total liquidations came from those betting against the price.
Bulls Take The Lead As Technical Indicators Flash Green
Ethereum’s technical outlook suggests that it is consolidating within a triangular pattern on the weekly chart, a formation that often signals an impending breakout. This price structure has seen ETH consistently bounce off a crucial rising logarithmic trendline, which began early last year. For the bullish momentum to fully validate a breakout, Ethereum’s price must clear a significant resistance level at approximately $2,829. Successfully closing above this level could pave the way for Ethereum to rally toward its all-time highs.
Ethereum’s path to a sustained bull run may also rely on the ETH/BTC trading pair, which has been in a downtrend since early 2022. A reversal in this trend could further amplify Ethereum’s upward trajectory. As Bitcoin dominance often cools after massive rallies, Ethereum and other altcoins tend to capture capital inflows, and if the ETH/BTC pair reverses, Ethereum could be positioned to capitalize on this shift.
Solana Competition and ETF Outflows Present Challenges
Ethereum’s bullish outlook, however, faces competition from Solana (SOL), a fast-emerging blockchain known for its efficiency and scalability. Solana’s on-chain activity has surged in recent months, capturing the attention of both retail and institutional investors. The SOL/ETH pair has been in a strong upward trend, with Solana seemingly eating into Ethereum’s DeFi and NFT market share. Solana’s investment products recorded over $10 million in cash inflows last week, while Ethereum-based funds saw negative flows. In fact, U.S. spot Ether ETFs registered over $25 million in outflows over the past two weeks, driven largely by Grayscale’s ETHE.
Ethereum’s Strength in Web3 and DeFi is Undeniable
Despite the competition, Ethereum’s network remains a giant in the Web3 ecosystem. With over $49 billion in total value locked (TVL) and a stablecoin market cap exceeding $84 billion, Ethereum retains a stronghold in decentralized finance (DeFi) and broader Web3 innovation. This massive liquidity and extensive ecosystem underpin Ethereum’s resilience, even amid intensifying competition.
As Ethereum navigates the current technical setup, its long-term potential remains linked to the evolving Web3 landscape and adoption trends. For now, all eyes are on Ethereum’s resistance level at $2,829 as a key indicator of its path forward. Should the bulls break through, Ethereum could be on the cusp of a major rally—one that could see it challenging previous highs and solidifying its standing against competitors like Solana.
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.
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