Ethereum’s price has surged dramatically, marking its best weekly performance since May 2021. Since the start of this week, Ether (ETH) has rocketed by over 37.50%, including a notable 10.30% uptick in just the past 24 hours. What’s behind this meteoric rise? A potent mix of technical upgrades, market dynamics, and macroeconomic factors.
The Pectra Effect: Upgrades and Innovations
A significant driver of this Ethereum rally is the recent Pectra upgrade, which went live on May 7. This upgrade introduced critical improvements such as higher staking limits and account abstraction (EIP-7702), making Ethereum not only more robust but also more adaptable. These changes have positioned Ethereum to outpace the broader crypto market, with ETH gaining over 34.3% since May 8—compared to a more modest 10.91% increase in total crypto market capitalization. For more insights into the future implications of these upgrades, see Vitalik Buterin’s vision for Ethereum: Pectra, Glamsterdam and beyond.
Moreover, the timing of these upgrades coincided with a broader positive sentiment in the market. The announcement of a new trade agreement between the US and the UK on May 8, followed by the initiation of US-China trade talks, has injected optimism into the market. These geopolitical developments have seemingly buoyed investor confidence, contributing to Ethereum’s ascent.
Short Squeeze and Market Dynamics
But there’s more to the story. Since May 8, the Ethereum futures market has witnessed a massive short squeeze, further propelling prices upward. Traders betting against Ethereum found themselves in a tight spot as prices rose, forcing them to cover their positions. This short covering resulted in $437.94 million in short liquidations, while long liquidations stood at $211.29 million, according to CoinGlass.
The surge in Ethereum’s open interest—from $21.28 billion on May 8 to $26.77 billion by May 10—reveals a burgeoning interest among traders. This uptick in open interest, coupled with rising weekly funding rates for perpetual futures (from 0.10% to 0.15%), suggests a bullish sentiment is prevailing. More traders are going long, willing to pay higher fees to maintain their positions, which underscores the market’s confidence in Ethereum’s continued rise. This trend aligns with recent observations in Ethereum bulls show interest as traders’ confidence in ETH’s $1.8K level improves.
Mega-Whale Accumulation: A Sign of Confidence?
Interestingly, as Ethereum’s price has climbed, so has the activity among its so-called “mega-whales”—those holding over 10,000 ETH. Data from Glassnode indicates that the net position change of these whales turned positive in late April, with their holdings reaching the highest level since March 2025, surpassing 40.75 million ETH.
This accumulation by large investors signals a strong belief in Ethereum’s future price gains. It’s a classic case of the big players positioning themselves ahead of the curve, boosting overall market confidence.
Technical Patterns and Future Projections
Ethereum’s price is also finding support from its technical patterns. Currently, ETH is bouncing off a long-term ascending support line, which forms the lower boundary of a large symmetrical triangle pattern on the monthly chart. Historically, such bounces have been precursors to significant rallies, and the current setup suggests a potential move toward $3,400—an impressive 40% increase from current levels.
Veteran traders, like Peter Brandt, have pointed to these patterns as indicators of a potential “moonshot” for ETH. While these projections are exciting, they raise questions about sustainability. Can Ethereum maintain this momentum, or are we witnessing a temporary surge?
Looking Ahead: Uncertainties and Opportunities
As Ethereum continues its upward trajectory, the key question remains: how long can this rally last? While the current market dynamics and technical setups are favorable, the crypto market is notoriously volatile. The interplay of macroeconomic factors, regulatory developments, and market sentiment will continue to shape Ethereum’s path.
For now, Ethereum’s impressive performance is a testament to its resilience and the growing confidence in its ecosystem. But as with all investments, caution and due diligence remain crucial. The coming months will be pivotal in determining whether Ethereum’s current rally is a harbinger of sustained growth or a fleeting moment in its volatile journey.
Source
This article is based on: Why is Ethereum (ETH) price up today?
Further Reading
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- US crypto groups urge SEC for clarity on staking
- Restaking can make DeFi more secure for institutional traders
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
