Ether's Record-Breaking Week: Factors Fuelling the Rally and Future Price Predictions

Ethereum Experiencing High Weekly Gains

Ethereum has been on a winning streak, undergoing its most substantial weekly gain since May 2021. Seen in retrospect, this budding coin has soared by over 37.50% in the week that culminated on May 11, inclusive of 10.30% gains recorded in the last 24 hours alone.

Impact of Global Trade Agreements

Crypto observers have noted that the recent upward surge of Ether’s performance comes on the heels of global economic developments. A new trade agreement between the US and the UK, announced on May 8, and the commencement of US-China trade discussions subsequently provided an impetus for Ether’s ascent. The larger crypto market also responded favorably to these diplomatic machinations.

Ethereum’s Internal Modifications

Aside from the welcoming global trade winds, Ether has also gained on the back of some internal modifications. The introduction of the Pectra upgrade on May 7, for instance, has added significant impetus to Ether’s bullish trend. This upgrade is set to deliver key improvements such as increased staking limits and account abstraction (EIP-7702), enhancing Ethereum’s usability and flexibility.

Ethereum Outperforms Crypto Market

Since the rollout of the Pectra upgrade on May 8, Ether has seen a remarkable gain of over 34.3%, significantly outpacing the crypto market’s 10.91% surge in total capitalization over the same time frame.

Rivalry with Bitcoin

Bitcoin, another prominent player in the crypto space, broke past the symbolic $100,000 mark. Still, Ether has outshone Bitcoin in terms of percentage gains.

Short Liquidations Fueling Ethereum

The Ethereum Futures market has also played a stellar role in pushing Ether upward. Since May 8, traders who had bet against Ethereum were compelled to exit their positions, resulting in $437.94 million recorded as short liquidations. As Ether prices shot up, short sell traders had to purchase more Ether, further boosting its price.

Open Interest In Ethereum Rises

Fueling the bullish sentiment in Ethereum has been the sharp increase in the open interest from $21.28 billion on May 8 to $26.77 billion recorded on May 10. The increase signals that more traders are entering the market, opening new positions, and displaying willingness to pay additional fees to maintaining open positions.

Ethereum Attracting Large Investors

The recent Ether price surge has come with significant accumulation among its mega whales, i.e. wallets holding more than 10,000 Ether, further fueling Ether’s potential for growth.

Ethereum Price Predictions

In terms of Ethereum’s price, it is bouncing off a long-term rising support line noticeable on the monthly chart, forming the lower boundary of a significant symmetric triangle pattern. This bounce increases the probability of a move toward the triangle’s upper trendline, close to $3,400 in the approaching months, constituting roughly 40% increase from the current price levels.

Conclusion

All of these developments and indicators suggest bullish bias in Ethereum in the near future. However, investors should always conduct their research and understand the inherent risks in crypto trading. The surge in Ethereum is indeed an exciting development in the crypto world, but as with all investments, caution and diligence are paramount.