Ethereum Breaks Year-Long Downtrend, Eyes 60% Gain to $4,000

Ethereum has recently demonstrated a significant shift in market momentum, breaking a year-long downtrend in its Relative Strength Index (RSI) and reclaiming the crucial $2,500 support level. This technical development has sparked renewed bullish sentiment among investors and analysts, positioning Ethereum for potential upward price action.

The RSI breakout, which occurred after a prolonged period of subdued momentum, marks a pivotal moment in Ethereum's price trajectory. The RSI crossing above the 50 threshold for the first time in over a year indicates a resurgence of buying pressure and renewed investor confidence. This shift aligns with Ethereum’s price recovery from its April 2025 lows near $1,500, suggesting that buyers are regaining control and setting the stage for sustained upward price action.

Following its initial rally, Ethereum encountered resistance at the 21-week simple smoothed moving average (SSMA), hovering around $2,532. The subsequent consolidation phase above the $2,500 support level has been critical in establishing a stable base for further gains. Closing above the 21 SSMA for the first time since late 2024 is a significant technical development, as this moving average has historically acted as a strong resistance barrier. This breakout and consolidation reinforce the bullish narrative, with the 21 SSMA now potentially serving as a dynamic support level. This shift enhances Ethereum’s technical setup, indicating a higher probability of trend continuation and increased investor confidence in the near term.

Ethereum is currently testing a long-term ascending trendline, which represents a critical juncture for the asset’s price trajectory. A weekly close above this trendline would confirm a full recovery of the bullish structure, opening the door for a potential rally toward the $4,000 resistance level. This target aligns with previous zones where sellers had capped upward momentum, making it a significant hurdle to overcome. Market participants are closely monitoring Ethereum’s interaction with this trendline, as it will provide valuable insights into the strength and sustainability of the current bullish move. A successful breakout could attract additional buying interest, propelling ETH into a new phase of upward momentum.

According to sources, this technical shift positions Ethereum to potentially rally toward the $4,000 mark if momentum sustains. The approaching long-term trendline represents a decisive test that could confirm further upside potential, with $4,000 emerging as a key target. Investors and traders should watch these technical levels closely as Ethereum navigates this critical phase, potentially setting the stage for sustained growth in the coming weeks.