Focus on ETH breakout as investors gather after the outflow

Ethereum is showing renewed bullish energy after rebounding from the lows of $3,435. The cryptocurrency is currently trading around $4,116, with price stability suggesting a pause before a possible continuation.

Market analysts believe the current pattern reflects a short-term recovery that could lead to a broader expansion once key resistance levels are cleared. As a result, Ethereum's increased open interest and expanded exchange activity indicate increased market engagement from both institutional investors and retail traders.

Fibonacci and EMA levels define next direction

Ethereum’s recent rally saw it reclaim the 0.5 Fibonacci retracement level at $4,099, turning it into immediate support. The next major resistance lies near the 0.618 retracement near $4,255, the confluence zone with the 200-EMA. A break above this area could open the way to the 0.786 retracement target at $4,478. However, if the price closes below $4,099, downside pressure toward $3,948 could surface.

ETH price dynamics (Source: TradingView)

Additionally, the coincidence of the 20, 50, 100, and 200 EMAs is reinforcing the strengthening trend. Price remains above all short-term moving averages, with the 50-EMA at $4,077 being the key pivot.

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If the price continues to close above the 200-EMA at $4,103, a move towards the $4,250 to $4,300 zone is likely to be confirmed. Current market conditions suggest that the bulls are gradually regaining control, but resistance remains strong.

Derivatives and on-chain activity support positive outlook

Open interest in Ethereum futures surged to $49.24 billion, the highest level since mid-2025. This sharp rise indicates increased trader participation and capital inflows into the derivatives market.

Rising open interest often precedes large volatility spikes, suggesting market participants are expecting a definitive breakout soon. Additionally, this trend reflects the strong momentum seen across major altcoins, reinforcing Ethereum's key role in the broader recovery.

Additionally, on-chain data reveals continued currency outflows throughout 2025, reflecting investors' self-custody orientation during market consolidation. While outflow was predominant, there was a temporary spike in inflow and selective accumulation in May, July, and September.

Ethereum recently recorded a modest positive net flow of $977,000, suggesting renewed confidence as the price stabilized around $4,115. This subtle change suggests that we may be entering a cautious accumulation phase before a stronger rally.

Security debate once again attracts attention

Separately, the Ethereum co-founder reignited the debate over blockchain security by revisiting the impact of the 51% attack. He emphasized that while validators can collude to disrupt the network's consensus, they cannot alter the history of a valid blockchain or seize its assets.

His remarks highlight the continued need for decentralization and minimizing trust within proof-of-stake systems. Therefore, even though Ethereum's price is showing resilience, this discussion highlights that security remains just as important for long-term sustainability.

Technical outlook for Ethereum price

Ethereum is trading around $4,116, holding steady after a strong recovery from the lows of $3,435, with key levels still clearly defined. Upside objectives include $4,255 (0.618 Fibonacci) and $4,478 (0.786 level), both of which serve as important resistance zones. A break above $4,255 could pave the way to $4,500, and if momentum builds, it could head toward $4,700.

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On the downside, the first support is around $4,099 (0.5 Fibonacci), followed by $4,030 and $3,948, with buyers previously following the trend. The 200-EMA near $4,103 forms an important pivot area, and a sustained close above this is likely to confirm a continuation towards a higher target.

The technical setup shows Ethereum firmly in a tightening range, suggesting volatility will be compressed before expansion. Therefore, a definitive breakout above $4,255 could trigger a strong rebound, while failure to sustain $4,099 could result in a short-term correction.

Is Ethereum gearing up for another rally?

Ethereum’s outlook for late October will depend on whether buyers can maintain control above the $4,099 to $4,070 zone. Increased open interest and small inflows suggest increased confidence among traders. If the bullish volume expands, ETH could retest $4,255 and extend towards $4,478.

However, rejection by resistance can lead to movement within range before a larger change in direction. For now, Ethereum is still in a critical phase, and sustained strength above the 200-EMA could determine the next big move.

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