Ethereum Price Prediction: Bounce Off Structural Level Anticipates Move to $3.9K

Ethereum (ETH) has risen by 3.6% in the past 24 hours to nearly $3,100 as positive sentiment seems to be picking up in the first couple of days of 2026.

The market has flushed out $220 million worth of short positions as a result of this uptick, potentially setting the stage for a recovery as the top altcoin has managed to rise past the $3K threshold once again.

After closing the year with a 11% loss, ETH enters a month that has typically been favorable for its price. According to CoinGlass data, the token has delivered an average gain of 47% during the years that it has closed the month in positive territory.

Based on this data, there’s a 56% chance that ETH will close January with gains (5 out of 9 years).

Market Sentiment and Traders’ Participation Improve

Market sentiment has been improving lately, with the Fear and Greed Index already recovering near “Neutral” territory after hitting a record low of 11 just a few weeks ago.

This suggests that the panic has passed, and market participants could be getting ready to jump back into the market.

Open interest in ETH futures has also been rising, moving from a low of 10.9 million ETH in October 18 to 13.4 million ETH at the time of writing. Although this metric is still 12.4% below its July peak, this is a remarkable recovery at a point when the price is still trading more than 37% below its all-time high.

Ethereum-linked exchange-traded funds (ETFs) have not yet followed this uptrend as investors withdrew $100 million out of these vehicles during the last week of December. If positive net inflows start to pick up, this could turn all technical indicators in favor of bulls.

ETH Bounces Off $2,800 But Downside Risks Persist

We have been tracking Ethereum’s price action around the 100-week exponential moving average (EMA) for a while now, and it appears that the market could be about to pull a bear trap.

ETH/USD Weekly Chart (Bitstamp) – Source: TradingView

The price briefly broke this line but found strong support at $2,800 – a previous high that can be considered a pivotal area from a structural standpoint.

There seems to be some sort of consolidation going on at this key level. Hence, if ETH rises past $3,300, which is a key level in the daily chart, this could mark the beginning of a leg up to $3,900 at least.

This will be ETH’s short-term ceiling as we continue to be on a downtrend until otherwise confirmed by the price action. The price would have to climb past $4,000 to invalidate that structure, and this would confirm the end of the bear market.

That said, if we lose the $2,800 support in the next few days, the baseline bearish scenario would still be in play, meaning that ETH could drop to at least $1,600 in the near term.