Ethereum Price Prediction: ETH Eyes $4,200 For the First Time Since 2021 – Massive Rally Coming?

Ethereum (ETH) has gone up by 3.5% in the past 24 hours and has closed the last 5 out of 6 sessions with strong gains as the market seems determined to retest the $4,000 psychological threshold.

After two strong days of net outflows that saw more than $600 million move out of Ethereum exchange-traded funds (ETFs), data from Farside Investors shows that $222 million went into these vehicles yesterday.

ETH ETFs Net Inflows (Daily) – Source: Farside Investors

This strong inflow preceded the release of an executive order (EO) from President Donald Trump that has paved the way for investors to freely add cryptocurrencies to their retirement accounts – specifically employee-sponsored vehicles like 401(k)s.

This type of account holds over $8.7 trillion in assets for U.S. workers according to June 2025 data from the Investment Company Institute.

Through already-existing ETFs like the iShares Ethereum Trust ETF (ETHA) and the Grayscale Ethereum Trust ETF (ETHE), investors can already buy ETH via the regulated markets.

However, tax-advantaged vehicles like 401(k)s did not support this kind of product. Trump has now instructed the Labor and Treasury Departments along with the U.S. Securities and Exchange Commission (SEC) to “facilitate access to alternative assets for participant-directed defined-contribution retirement savings plans by revising applicable regulations and guidance.”

Even if just 1% of the balance of 401(k)s as a whole flow to cryptocurrencies, that would still represent an $87 billion inflow that will move toward regulated vehicles like these ETFs. Big if true, as some would say.

ETH Sets Its Eyes on Last December’s Highs

Today is a big day for ETH as the price has hit $4,000 for the first time since December last year. This represents a huge comeback for the top altcoin after hitting $1,400 earlier this year.

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

The successful implementation of the Pectra upgrade along with multiple regulatory tailwinds, especially in the United States has produced a wave of positive momentum for ETH.

Although the price initially plunged after hitting this threshold during the beginning of the American session, it has now recovered and the market seems determined to retest those December highs of $4,100 today.

Trading volumes have increased by 23% in the past 24 hours as ETH makes its way to this key psychological threshold.

In a previous ETH price prediction, we emphasized that ETH had tagged and bounced off a key trend line support and that favored a push to $4,000 in the near term. Here we are, just three days after that article came out, and ETH has produced an 11% gain.

Big Liquidations Confirm a Short Squeeze in the Making

Depending on how the price behaves at $4,100, this could either be a good time to take some profits off the table if there are clear signs that selling pressure is rising or it could also set up ETH for a major rally if bulls pull a short squeeze.

ETH Crypto Liquidations ($100K+) – Source: CoinGlass

We are already seeing some big liquidations of positions valued at more than $100,000 across multiple exchanges as Ethereum has made its second move above $4,000.

In the past 12 hours, ETH is leading the scoreboard with $55 million worth of short positions wiped out as a result of this rally. The stage seems set for a much bigger squeeze if bulls have the necessary ammo to pull it off.

We could witness the first move toward $4,200 since December 2021. Is this the beginning of ETH’s second trip to $5,000?