Ethereum has burst through its 2021 all-time high of $4,860, marking a significant milestone in the current bull cycle. This achievement follows a robust 14% surge last Friday, one of the year’s most formidable single-day performances. The rally was sparked by Federal Reserve Chair Jerome Powell’s remarks at the Jackson Hole symposium, hinting at potential shifts in U.S. monetary policy. His words sent ripples across financial markets, with Ethereum leading the charge among altcoins. This aligns with recent trends highlighted in Crypto Booms as Fed Goes Dovish: Here’s What It Means for Ethereum, Solana and Dogecoin, where dovish signals have historically spurred crypto rallies.
Ethereum Derivatives Signal Historic Momentum
The ripple effects of Ethereum’s price surge have been notably felt in the derivatives market. In a whirlwind 24-hour period, Open Interest (OI) for Ethereum futures spiked by nearly 10%, as traders poured in with $3.18 billion in new positions. Analyst Maartunn described this phenomenon as “insane stuff,” underscoring the frenetic pace at which investors are positioning for Ethereum’s next big move.
The surge in OI reflects a burgeoning speculative appetite, with market players betting heavily on Ethereum’s continued upward trajectory. While increased OI can fuel rallies by adding liquidity, it also raises the specter of volatility, especially if leveraged positions start to unravel. Nonetheless, the sheer scale of inflows signals a strong conviction in Ethereum’s potential to soar higher.
Adding to the bullish sentiment, Ethereum’s Taker Buy Volume—representing aggressive market buy orders—has reached a multi-month peak of $5.76 billion. This metric suggests that demand isn’t merely speculative but also urgent, as bulls dominate both the spot and derivatives arenas.
Price Surges To Retest New Highs
Ethereum’s price action is a spectacle of momentum. The 4-hour chart reveals an explosive move past $4,800, following a strategic bounce near the 100-period SMA (around $4,298). Bulls have not only defended support but propelled Ethereum into a vertical ascent, retesting the previous all-time high zone near $4,860. The 50-period SMA is angling upwards, confirming a short-term bullish structure, while the 200-period SMA remains well below, supporting the broader uptrend.
Volume spikes during this breakout lend credence to its strength, and if momentum persists, Ethereum could venture into uncharted territory, eyeing the psychological $5,000 level. However, should resistance at $4,860 prove formidable, a retreat to the $4,400–$4,500 range, where key moving averages converge, may be on the cards. This pivotal juncture could see Ethereum either solidifying its breakout or consolidating before another push higher.
A Cautious Optimism
The current Ethereum rally is a testament to the dynamic interplay of market forces. With bulls holding the reins, the potential for further gains is tangible—but so are the risks. As traders adjust their positions in response to evolving market conditions, the landscape remains fluid. This mirrors the sentiment in Ethereum, Bitcoin Spike After Powell Signals Interest Rate Cut, where market reactions to monetary policy shifts have been pivotal.
The implications of this rally extend beyond immediate price action. With Ethereum entering a decisive phase, questions loom about sustainability and the potential for excessive leverage. As always, the market’s next moves will be influenced by a myriad of factors, including macroeconomic signals and investor sentiment.
While Ethereum’s future path is uncertain, the current momentum highlights the cryptocurrency’s resilience and the market’s appetite for growth. As August rolls on, all eyes will be on Ethereum, as it navigates this high-stakes environment with potential new highs on the horizon—or a cautionary pause before the next chapter unfolds.
Source
This article is based on: Ethereum Open Interest Jumps 10% As $3.18B In New Positions Flood In
Further Reading
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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.
