according to the website - By Coindoo.com
Recovery has become one of the most powerful rallies in recent weeks, driven by improvements in technical indicators, a resurgence of ETF inflows, and rising expectations of a potential supply reduction on exchanges.
The recent rise followed a prolonged period of consolidation marked by declining demand and repeated attempts to break resistance levels. The new upward momentum is reflected in many technical indicators: daily summaries of oscillators and moving averages show a clear bias towards buying, while assessments indicate continued growth. The four-hour RSI of Ethereum has emerged from the oversold zone and is now fluctuating near the upper boundary of the range, demonstrating strong buyer activity, but not yet signaling market exhaustion.
Meanwhile, the MACD trend has moved into positive territory, stimulating a new bullish impulse after a week of sideways pressure, confirming the improving market sentiment.
The positioning of derivatives played a decisive role in the breakout. Over the past 24 hours, more than $69 million in ETH has been liquidated, with the main losses suffered by traders holding short positions. Short positions were closed for about $56 million, while long positions totaled less than $13 million, leading to 'bears' being forced to aggressively buy back assets, contributing to the acceleration of growth.
The key catalyst was the renewed influx of funds into spot ETFs on Ethereum. Data shows that after two consecutive days of outflows, institutional demand recovered on December 8, and the total influx of funds became positive again. This turnaround indicates an aggressive return of investors to the market, coinciding with the price recovery and confirming the view of a stabilization of sentiment around ETH.
The dynamics of fund flows also indicate deeper changes in the ecosystem. While some issuers have shown moderate activity, the broader trend reflects that investors are buying on dips rather than closing positions—a behavior typically associated with phases of a continuing bullish trend.
Analysts are increasingly noting the reduction of exchange balances. Market commentator Crypto Rover pointed out the trend of decreasing ETH reserves on centralized platforms, indicating a reduction in the number of tokens available for active trading. This 'supply shock' narrative has gained widespread attention on social media: charts show that exchange-controlled ETH reserves are decreasing, while demand indicators are rising.
The reduction in the supply of liquid assets combined with rising demand often amplifies volatility to the upside, and the current market behavior seems to support this thesis.
On Ethereum price charts, higher lows are being formed despite the overall market uncertainty. The latest breakout confirms this structure and prepares the asset for testing higher resistance levels while demand persists. Analysts view the $3300–$3400 level as a psychological range where momentum may be tested, while $3000 now acts as a short-term support buffer.
Traders continue to speculate that Ethereum's dynamics may accelerate as liquidity moves from bitcoin ETFs into yield-generating smart contract assets and tokenization-focused platforms. At this point, technical strength, renewed institutional participation, and reduced supply position Ethereum as one of the most dynamically developing cryptocurrencies with a high market capitalization by the end of December.
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