Ethereum News Today: Ethereum Surges 20% Approaching $4,000 on Bullish Momentum

Ethereum's price has surged, approaching the significant psychological barrier of $4,000 after weeks of consolidation. The cryptocurrency has shown a powerful breakout, surpassing major resistance zones and indicating renewed bullish momentum. On the daily chart, Ethereum's price has been marked by strong Heikin Ashi candles, supported by rising volume and an overheated Relative Strength Index (RSI), suggesting that bulls are currently in control.

The surge in Ethereum's price is attributed to broader market optimism, fueled by renewed speculation around Exchange-Traded Funds (ETFs) and a surge in decentralized finance (DeFi) activity. The daily chart, which shows multiple consecutive green candles with minimal downward wicks, confirms that this is not just hype but a technically strong move supported by indicators.

The RSI is currently at 88.61, well above the traditional overbought threshold of 70. This extreme reading, while signaling tremendous momentum, also suggests a potential short-term cooling. Historically, when Ethereum's RSI reaches these levels, a pullback or consolidation follows within 5–7 days. However, overbought conditions during strong breakouts often lead to bullish continuations if volume supports the trend. In May 2021, Ethereum's RSI reached 88, followed by a 10% rise before a 15% correction. A similar setup now suggests Ethereum could hit $3,950–$4,000 before facing resistance.

Looking at the Fibonacci retracement levels drawn from the previous swing high and low, Ethereum has broken past multiple retracement zones, including $2,800, $3,200, and $3,488. The next key target zone is $3,747.4. If Ethereum's price breaks above $3,750, the next Fibonacci extension target sits at $4,150, aligning with the psychological round number of $4,000. Using a simple Fibonacci extension method, if the swing low was $2,400 and the swing high was $3,488, the difference is $1,088. The Fibonacci 1.618 extension would be $2,400 + (1.618 × $1,088) = $4,162, pointing toward a possible $4,150–$4,200 target in the coming weeks.

Currently, Ethereum's price is trading in Wave 3 of an Elliott Wave pattern, which typically represents the strongest bullish leg. The chart shows clear impulsive movement without significant retracement, confirming bullish control. The lack of bearish divergence on the RSI and the strength of the current candles support the case for a continuation rally, at least until $3,950–$4,150. However, traders should note that Ethereum is overbought, and pullbacks to $3,200 or $2,950 are possible. Strong support lies between $2,850–$3,200.

Given the current momentum, strong Heikin Ashi structure, and RSI-backed breakout, Ethereum's price is likely to continue its upward journey. In the short term, the bullish scenario suggests Ethereum could hit $3,950–$4,150. A consolidation scenario would see Ethereum stabilize between $3,200–$3,600. A bearish reversal is only likely if Ethereum drops below $2,950. The technicals support a bullish continuation, but with the RSI so high, short-term pullbacks are natural and even healthy. If looking to enter, consider waiting for a dip near the $3,200 zone or ride the wave with a tight stop loss. Ethereum's price looks strong, and the chart setup could be signaling the start of a major bullish phase. If it breaks $3,750 convincingly, $4,150 may just be the next destination.