Ethereum (ETH) Price Breaks Out to 20-Month High; Sponge V2 Unleashes Meme Coin Mania

Ethereum (ETH) has started 2024 with a bang, breaking out above $2,400 for the first time since May 2022. At the time of writing on January 2nd, ETH is trading at $2,425 – up over 5% in the last 24 hours. Bitcoin has also rallied over 7% to trade above $45,500.

According to crypto analyst Sypool’s recent TradingView analysis, Ethereum’s price action is closely tied to Bitcoin’s current bull run:

“As the window period of the BTC ETF approaches, the fluctuations of the market gradually amplify. The current options open interest in BTC is at an all-time high, approaching $20 billion. On Deribit, among the options with expiration dates on January 5 and January 12, the number of call options is clearly leading…”

Sypool goes on to explain how the options market data indicates a high probability of SEC approval for a Bitcoin ETF in the coming days. The shrinking GBTC premium and reducing GBTC holdings by Ark Investment also signal growing confidence in an imminent BTC ETF.

Sypool believes these market signals point to Bitcoin potentially reaching $50,000 in the short-term. And as a closely correlated asset, any surge in Bitcoin would likely drag Ethereum to new local highs.

On the ETH/USD daily chart, Sypool notes the Moving Average Extension (ME) indicator remains firmly bullish. However, he points out that Ethereum whales did not provide much buying support during the last push above $2,400.

Looking at the 4-hour timeframe, Sypool says that although the bullish ME reading holds, yesterday’s rally occurred without a blue volume column. This suggests weaker momentum that could limit further upside around current levels.

In summary, Sypool believes Ethereum remains in a bullish trend but may struggle to break out above $2,500 in the coming days. He sees ETH next upside capped around $2,500 if Bitcoin makes a run towards $50k on ETF approval rumors.

A Retest of Breakout Levels Seems Likely

Analyzing the ETH/USD chart, we can see the breakout cleanly cleared the psychological $2,400 mark with reasonably high trading volumes. However, the last 10 hours have yielded a ret

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Author: BeInCrypto Team

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