ETH is rising on the back of whale accumulation, new spot ETF inflows, and improving risk sentiment as traders focus on December seasonality, Fed policy, and $4,000 resistance.
summary
- Ethereum outperformed Bitcoin and several altcoins as conditions improved ahead of the FOMC decision and whales and corporates increased accumulation and futures leverage.
- The US Spot Ethereum ETF has returned to net inflows, indicating that institutional demand is returning, helping maintain the current uptrend despite recent volatility.
- Analysts say a clean break through key resistance is needed for the rally to extend toward $4,000, but a rejection could be triggered if leveraged longs get squeezed.
Ethereum posted gains as crypto market sentiment improved ahead of the US Federal Open Market Committee's interest rate decision, according to market data. The digital asset's progress outpaced that of Bitcoin and several alternative cryptocurrencies during the trading period.
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Market watchers said the price fluctuations appeared to be driven by buying activity by large investors, while companies and institutions expanded their holdings. The U.S. Spot Ethereum (ETH) exchange-traded fund recorded new capital inflows this week, according to data, suggesting institutional investor participation.
Market analysts are waiting to see whether the bull market can maintain its momentum into December. Although historical performance data for the month shows mixed results, recent market trends indicate positive sentiment.
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CoinGlass data shows that Ethereum has achieved a positive average return in December since 2016. According to the data provider, the cryptocurrency has been recording gains until early December this year, reflecting sustained trader activity.
On-chain metrics cited by analysts indicate that large holders, commonly referred to as whales, have accumulated significant amounts of the cryptocurrency over the past month. Analysts said this accumulation pattern suggests long-term confidence among major investors.
The US Spot Ethereum ETF has attracted inflows from institutional investors throughout recent trading sessions, according to fund flow data. Market expectations regarding a possible Federal Reserve rate cut supported broad sentiment in the crypto market and contributed to the rally.
Market data shows some large investors hold heavily leveraged positions, indicating confidence in the potential for price increases. These positions have a liquidation level set below the current market price, meaning that a significant price drop will trigger an automatic liquidation of the position.
Analysts said a return to a key resistance level could extend the bull run, but a rejection at that threshold could lead to a pullback. Market participants continue to monitor trading volumes and institutional flows as indicators of near-term price direction.
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