Ethereum Consolidation Nears Resolution: Analyst Flags $4,000 Upside Scenario

Rising network use and ETF demand strengthen Ethereum’s support, setting the stage for a possible move toward $4,000.

Ethereum has traded within a wide range for more than two months. And this stifled outing has left market participants waiting for a clear direction. Recent onchain data and investment flows suggest that the coin could soon flip this trend. Analyst Ali Martinez points to engagement and steady capital inflows as possible market drivers of a move higher for the coin.

Ethereum Daily Active Users Double as Network Engagement Rises

Ali relied on on-chain metrics to highlight how users have been interacting with the network recently. Data shows that month-over-month activity retention has nearly doubled in the past four weeks. In fact, such retention levels have not been seen in years.

As per data from Glassnode, around 4 million new active addresses joined the network this month. And this latest addition brings the total active addresses to roughly 8 million. 

While earlier spikes were tied to airdrop activity, the latest increase aligns with stronger retention among new users. Even more, it suggests sustained participation rather than short-term speculation.

In addition to the monthly activity surge, daily active addresses have also increased. Figures climbed above 800,000 in the past two weeks, nearly doubling in that time. 

Image Source: Ali Martinez

Transaction activity followed a similar trend, reaching about 2.8 million transactions per day. Analysts link this rise to the recent Fusaka upgrade, which expanded block capacity by roughly one-third.

Interestingly, higher usage has not led to higher costs. Average transaction fees have fallen, reflecting Ethereum’s shift toward offloading execution to Layer-2 networks such as Arbitrum, Base, and Optimism. Mainnet activity now centers more on settlement and stablecoin transfers, reinforcing the network’s scaling strategy.

ETF Accumulation Signals Growing Confidence in Ethereum Price Outlook

Ali also noted that demand for crypto-tied investment products has strengthened. Since December 29, Ether-linked exchange-traded funds have accumulated about 158,545 ETH, valued at nearly $520 million. 

Between January 12 and January 16, these investment vehicles pulled in roughly $2.7 billion, according to market observers. 

The data suggests that the most concentrated Ether buying occurred when the asset hovered between $3,119 and $2,772. Analysts now view this range as a key support zone and say that it could provide a base for any future upside move.

Price Structure Points to Conditional Breakout

At the time of writing, Ether trades near $3,222 after a drop of more than 3% on the day. Market sentiment indicators sit in fear territory, while price remains below the 200-day simple moving average. Over the past year, Ether has fallen about 6% and lagged much of the top 100 crypto assets.

Short-term signals are more balanced. Seventeen of the past 30 days closed higher than they opened, and liquidity remains strong due to Ethereum’s large market cap. 

Image Source: Ali Martinez

Ali said price action continues to tighten within a triangle pattern on the daily chart. For now, the coin needs to hold above the $3,085 support level to stand a chance of a northbound march. 

According to the analyst, the coin could touch the $3,660 mark if it flips $3,400. At the same time, the asset could extend to $4,000, assuming it sustains the momentum. Failure to defend support would weaken the bullish case.

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