The price of Ethereum (ETH) has tried unsuccessfully to rise above $4k in recent days. However, the large-cap altcoin, with a fully diluted valuation of around $480 billion, has retested a crucial support level around $3.9k, which previously acted as resistance for the past three years.
Why is Ethereum’s price bullish in the medium term?
High demand from whale investors
Earlier on Monday, BitMine reported that it bought approximately 203.8k ETH in the past week. According to on-chain data analysis, three new addresses, likely belonging to BitMine, collected Ether worth around $250 million on Monday during the mid-North American session.
Last week the Ethereum investment product included a net cash inflow of approximately $205 million, increasing year-to-date capital inflows to approximately $14.2 billion and total assets under management (AUM) to approximately $34.5 billion.
Robust ecosystem
Demand for Ether from whale investors is largely influenced by the network’s popularity in the DeFi space. According to market data from DeFiLlama, the Ethereum network has a total value of approximately $86 billion and a stablecoin market cap of approximately $163 billion.
As such, the Ethereum network has attracted more organic investors and is well positioned to attract more users amid mainstream adoption of web3 products, fueled by clear regulatory frameworks.
Technical tailwind
The ETH price remains bullish in the medium term based on the technical outlook. For example, the Bollinger Bands have come under pressure and are forming a ‘W’ bottom, indicating more upside volatility in the short term.
Crypto analyst Ali Martinez noted that Ether price is well positioned to reach $4.4k after recovering from the lower end of a downtrend.
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