Ethereum has been on a downward trend for almost six weeks, falling below the $ 4,000 mark on December 16, 2024. Since then, it has dropped by more than 20%, negotiating $ 3,260. Analysts say that Ethereum needs a stronger blockchain activity, new uses of use and increased adoption to regain the confidence of investors and recover its previous summits.
Ethereum is faced with a resistance to $ 3,400, a key level which, if broken, could trigger the liquidation of more than $ 1.09 billion in short leverages, according to Coinglass data. Crypto Trader Case Abbé noted in an article on February 1 on X that Ethereum constitutes a bullish divergence on the daily graphic and that a daily fence greater than $ 3,400 could prepare the land for a rally around $ 4,000.
A research report by Bybit and Block Scholes on January 31 stressed that the commercial volume of Ethereum options has reached its highest level in more than a month. The increase in the volume of negotiation suggests that certain investors are positioned for a potential price rebound. Analysts noted that the appeal options, which are betting on the rise in Ethereum prices, experienced a bullish change between different expirations. However, they warned that an increase in the activity of options alone will only argue the price of Ethereum without a wider market support.
Aurélie Barthere, main research analyst of Nansen, said that Ethereum must increase her fundamental blockchain activity to remain competitive. Other layers of layer 1 catch up in terms of applications, transaction costs and ignition activity. Barthere has also stressed that Ethereum could benefit from a stronger collaboration with private companies and government entities, in particular in the United States, where blockchain regulatory conditions improve.
The reports suggest that the Ministry of Government Effectiveness (DOGE), led by Elon Musk, a non -governmental agency focused on economics initiatives, explored the monitoring of spending based on blockchain and financial management. There have been rumors that DOGE representatives met with public blockchain developers to discuss potential applications.
Ethereum could also see increased adoption thanks to potential companies related to the Trump family. Joseph Lubin, co-founder of Ethereum and founder of Consensys, suggested that the Trump family could consider a cryptocurrency company based in Ethereum, which could contribute to the growth of Ethereum.
Some industry analysts believe that institutional purchases via Trump’s World Liberty Financial Protocol could help Ethereum regain strength in February. However, they point out that the resumption of sustained prices depends on the adoption of the real world and the higher activity on the chain.
The options of Ethereum SCKEw, which measure the difference in implicit volatility between the appeal and put options, has moved in favor of upward positions. Although this indicates growing optimism among traders, analysts remain cautious, declaring that Ethereum needs stronger market to perceive key resistance levels and regain its previous summits.
