Key Takeaways
Ether ( ETHUSD ), the native cryptocurrency of the Ethereum blockchain, surged Monday to its highest levels in more than three months, boosted by optimism about the prospects for a favorable regulatory outlook under the Trump Administration and record inflows into recently launched spot Ether exchange traded funds (ETFs) .
In particular, investors believe that reduced regulatory barriers could benefit Ethereum by increasing the adoption of decentralized finance (DeFi) , an emerging peer-to-peer financial system that uses the cryptocurrency’s blockchain to execute transactions using smart contracts .
Spot Ether ETFs recorded net inflows of more than $215 million in the three days after the election, according to data from crypto analytics site CoinGlass , their highest three-day cumulative windfall since launching in late July.
Ether has risen roughly 38% over the past week, trading at around $3,320 recently and pushing the year-to-date gain to around 45%. Despite the recent surge, Ether has significantly underperformed bitcoin ( BTCUSD ), which has more than doubled in price since the start of the year.
Below, we take a closer look at Ether’s chart and use technical analysis to locate important price levels to watch out for.
Descending Channel Breakout
After a period of prolonged accumulation , Ether’s price broke out above a six-month descending channel late last week on above-average trading volume , with gains accelerating over the weekend.
While the relative strength index (RSI) confirms the cryptocurrency’s bullish momentum with a reading above the 70 threshold, the indicator also flashes overbought conditions that could trigger near-term price fluctuations.
Let’s identify several key technical levels on Ether’s chart that investors may be tracking.
Key Resistance Levels to Watch
The first overhead level to watch sits around $3,650. Investors who have purchased Ether at lower levels may seek to book profits in this region near a trendline linking countertrend upswings on the chart in late March, early April, and mid June.
A decisive breakout above this area could fuel a rally up to the $4,090 region, a chart location that would likely provide significant resistance near the cryptocurrency's prominent March 2024 swing high .
Important Support Levels to Monitor
During dips, investors should initially monitor how Ether’s price responds to the $3,250 level, an area where the cryptocurrency may encounter support near a trendline connecting a range of similar trading levels on the chart between April and July.
Selling below this level could trigger a fall to around $2,950, a location currently just above the descending channel’s upper trendline where investors may look for buying opportunities near the closely watched 200-day moving average and a series of lows that formed on the chart in April, May, and July.
A deeper retracement could see Ether revisit lower support around $2,720. This area may attract buying interest near a multi-month horizontal line that connects multiple peaks from early January to late October.
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As of the date this article was written, the author does not own any of the above securities.