Ethereum (ETH) has successfully surged past the critical $4,000 mark, trading at $4,010 at the time of writing. Over the last 24 hours, the cryptocurrency rose 1.5%, with trading volumes reaching $2.5 billion. The question now is whether this rally has the momentum to push ETH towards its all-time high.

On-Chain Indicators Signal Strength

Long-term holders (LTH) of Ethereum have shown renewed confidence as key on-chain metrics confirm a bullish sentiment. The Net Unrealized Profit/Loss (NUPL) indicator suggests the market has entered a “belief” phase, historically aligning with continued price increases.

Adding to this optimism is Ethereum’s Market Value to Realized Value (MVRV) ratio, currently sitting at 8.73%, according to Santiment. This figure signals ETH remains undervalued relative to its market potential. Historically, low MVRV values have preceded further upward momentum, while overly high values often point to sell-offs.

ETH Price Outlook: Eyes on $5,000

From a technical perspective, Ethereum bounced strongly off its key support level of $3,075, sparking the rally that has now crossed $4,000.

The Bull Bear Power (BBP) indicator—used to measure the balance between buying and selling pressure—is currently positive, indicating buyers are firmly in control of the market. If this bullish dominance persists, ETH could target $4,400 in the short term, with an ambitious next milestone of $5,000.

However, risks remain. Should sellers regain control, Ethereum could see a correction back toward its nearest support at $3,578.

Final Thought

While Ethereum’s bullish breakout and strong on-chain indicators fuel optimism, investors should remain cautious amid market volatility. As ETH approaches historical highs, traders may look for profit-taking opportunities.

This article does not constitute financial or investment advice. Always conduct your own research before making trading decisions.