Ethereum Price News: $500M ETF Inflows Makes ETH Bounce – $3k Next?

Ethereum (ETH) has gone up by 11% since the year started, as the market seems to have found strong support at $2,800 for the time being.

Investors have started to accumulate ETH tokens once again, following weeks of net withdrawals from exchange-traded funds (ETFs).

According to data from Farside Investors, ETH-linked ETFs brought in $470 million during the first four days of this week, bringing the total assets under management (AUM) held in these products to $18 billion.

This indicates an ongoing process of accumulation at a point when the market is trading relatively range-bound.

Weekly Application Fees on Ethereum – Source: Artemis

Meanwhile, on-chain data from Artemis shows that application fees, a metric that tracks how much money Ethereum’s decentralized apps (dApps) are earning, spiked to $43 million two weeks ago but have failed to sustain that wave of positive momentum as they dropped to $28 million last week.

What we need to see at this point is a sustained uptrend in application fees, as this has often preceded Ethereum’s strongest price upticks.

If fees rise above $40 million per week over the next few weeks, that would be a strong indicator that traders’ interest in cryptos is rising rapidly.

Ethereum (ETH) Hits Key Structural Resistance

The daily chart shows that ETH broke out of a long-dated falling wedge in late October. This move resulted in a big drop from $4,200 to $2,800.

ETH/USD Daily Chart (Binance) – Source: TradingView

The latter has acted as a strong area of support on three occasions at least, confirming its technical relevance for market participants.

Now, the price action is touching a structural level at $3,300 that ETH needs to clear to fully reverse its downtrend.

If we get a strong rejection off this mark, that could endanger the latest rally and favor either a bearish Ethereum price prediction or the continuation of the consolidation pattern that has formed lately.

That said, positive momentum has been steadily rising in the past couple of months, even though the price has not stepped out of consolidation yet.

This could be considered an early buy signal as it shows that momentum is building up ahead of this touch of a key resistance.

Bears Seem to Be Winning This Hand as $3,280 Support Falters

In contrast to the bearish scenario outlined previously, if we get a bullish breakout above $3,300, that could set off a short squeeze that brings us quite fast to $4,000 at least in the near term.

ETH/USD Hourly Chart (Binance) – Source: TradingView

However, the hourly chart shows us what’s happening behind the curtains. It seems that bears are trying to break a key support area at $3,280 during the American session. Losing this support could confirm a bearish outlook for ETH for the weekend.

Above-average trading volumes further confirm the move, but we still have to wait for the end of this hourly movement. In addition, we got a bearish divergence in the RSI that confirmed the start of a trend reversal.

This move below $3,280 could set off a deeper correction to $3,160 at least. The scenario outlined in the chart above shows a potential entry for a short position targeting a 3:1 risk-reward ratio.