Ethereum Jumps 3% in a Day… Will it Break $2,400 as Bitcoin Settles at $80,000?

▲ Ethereum (ETH) and Bitcoin (BTC) ©Dasol Ko

As investors' risk-on sentiment, fueled by favorable macroeconomic conditions, spreads across the cryptocurrency market, Ethereum (ETH) is experiencing a clear short-term upward rally accompanied by explosive trading volume.

According to cryptocurrency market data aggregator CoinMarketCap on May 4 (local time), Ethereum is trading at $2,375.71, having risen 3.13% over the past 24 hours. This is a solid performance, slightly surpassing the 2.27% increase of the leading cryptocurrency, Bitcoin (BTC), and the overall 2.17% rise in the total virtual asset market. Notably, its high correlation of a staggering 94% with the S&P 500 index over the past 30 days strongly suggests that this uptrend is thoroughly driven by macroeconomic capital flows.

The key driver of this price increase is not positive news within the individual ecosystem but rather the recovery of overall market momentum. Ethereum rose perfectly in line with the increasing trend of Bitcoin and the total cryptocurrency market capitalization. The improvement of the Fear & Greed Index, which represents market sentiment, from 45 to a neutral stage of 48, also created a positive environment and firmly supported the rally.

Currently, no unique catalyst for Ethereum has been identified. No distinct internal factors, such as protocol-related news, a surge in on-chain activity, or a short squeeze in the derivatives market, have been found. Therefore, the current upward trend is interpreted as a result entirely reliant on high market beta and a general risk-on sentiment.

The short-term market outlook appears to largely depend on whether Bitcoin can firmly hold the $80,000 level. If Bitcoin maintains its support level and Ethereum's 24-hour trading volume consistently defends its surged level of $16 billion (a 123% increase), there is a very high probability that it will test the next major resistance level of $2,400. Conversely, if buying pressure wanes and the $2,300 support level breaks, there is a risk of profit-taking leading to a pullback to the $2,200 range.

In conclusion, Ethereum's short-term outlook is summarized as cautiously bullish. While it is participating in the market's uptrend driven by massive trading volume, the absence of unique momentum is considered a factor of instability. Whether Ethereum can break free from Bitcoin's shadow, demonstrate its own upward momentum, and firmly reclaim the $2,400 level will be the market's biggest point of interest going forward.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*