Ethereum (COIN: $ETH) is flashing strength again after a volatile pullback, with the monthly chart hinting that the recent dip toward $3,000 may have been a textbook fakeout. A pattern eerily similar to Q2 2025, when ETH rallied over 100%, is now unfolding, with fundamentals aligning for another powerful move.
Macro Tailwinds Fuel the Setup
The broader macro landscape has shifted decisively toward risk assets. The U.S. government’s reopening, coupled with a proposed $2,000 stimulus for Americans, marks a renewed phase of liquidity expansion. The Federal Reserve’s pivot from tightening to easing, ending QT and signaling upcoming rate cuts in December, has injected optimism across equities and crypto markets.
Treasury liquidity injections are already underway, flipping the business cycle from contraction to expansion, historically one of the most favorable environments for crypto assets. As capital becomes cheaper and more abundant, yield-seeking investors are likely to rotate back into digital assets, led by Bitcoin and Ethereum.
Regulatory clarity is another bullish driver. The Clarity Act, designed to establish a clear framework for digital assets, is set to unlock institutional participation. At the same time, Altcoin ETF filings are reportedly in motion following the success of Bitcoin’s ETF approval, a move that could open Ethereum to mainstream capital flows.
On the industry front, Ledger’s potential New York IPO signals rising retail adoption, while Pakistan’s rupee-backed stablecoin initiative highlights global momentum in crypto utility and acceptance. Together, these factors underscore the sector’s maturing infrastructure and Ethereum’s central role within it.
Technical Outlook: Breakout, Retest, and Expansion Setup
From a technical standpoint, Ethereum’s monthly structure paints a compelling picture. The asset recently broke above a long-term descending trendline dating back to 2022, a critical breakout that many traders had been anticipating. The latest pullback to around $3K appears to have completed a healthy retest of that breakout zone, which now acts as major support.
Volume profiles indicate that selling pressure has begun to fade, while accumulation near the $2,800–$3,100 area mirrors past pre-rally conditions. A sustained close above $3,400 could confirm the start of a new impulsive leg targeting the $5K.
Momentum oscillators remain neutral to bullish, suggesting room for upside continuation. The fakeout below $3K likely served as a liquidity grab to shake out late longs and absorb sell-side orders before the next markup phase. In comparison, similar market structure manipulations in Q2 2025 preceded ETH’s explosive 100% move from $2,200 to $4,400.
If ETH maintains its higher-low formation, the path of least resistance remains upward. A reclaim of $3,600 would reinforce bullish control, while the next resistance lies around $4,950, Ethereum’s previous all-time closing high before the 2021 cycle top.
Final Takeaway On Ethereum
Macro liquidity is turning positive, regulatory clouds are clearing, and Ethereum’s chart shows a textbook breakout, retest continuation setup. With the Fed’s December rate cuts, stimulus checks, and ETF-driven inflows converging, Ethereum could lead the next crypto expansion phase.
As the world’s largest smart contract platform, Ethereum remains the backbone of decentralized finance, tokenization, and stablecoins. If history rhymes with Q2 2025, the next leg up could be imminent, turning this fakeout into the launchpad for ETH’s next major rally.
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