Ethereum's Path to $4,000 Faces Resistance Despite Market Optimism

According to Cointelegraph, Ethereum holders have returned to profitability, increasing the likelihood of a rally towards $4,000. However, Ether faces sell pressure risks around the $3,800 resistance level, which could delay bullish momentum. Over the weekend, Ether rebounded to $3,600, pushing its value above its active realized price, suggesting that the average ETH holder is no longer experiencing losses. This development raises the question of whether this is sufficient to propel ETH above the $4,000 mark.Data from Cointelegraph Markets Pro and TradingView indicates that Ether's price surged by 20% to $3,650 on Sunday, recovering from a four-month low of $3,957 reached on November 4. The recovery was driven by U.S. President Donald Trump's promise of $2,000 tariff dividend payments and optimism surrounding the potential end of the U.S. government shutdown. This rebound has also elevated ETH above its active realized price, currently at $3,545, according to Glassnode data. The return to profitability for the average ETH holder after enduring unrealized losses offers significant financial relief, signaling a bullish outlook. Historically, surpassing this level has shifted market sentiment from "fear," reducing sell pressure from holders who were previously underwater and encouraging retention.Holding above $3,500 is crucial for bulls aiming for a potential retest at $4,000. Other key support levels for the ETH/USD pair are around $2,870, $2,530, and $1,800, based on Ether’s extreme deviation pricing bands. However, Ether bears are expected to defend the $3,800 level. Ether’s cost basis distribution data reveals that investors hold approximately 4.2 million ETH at an average cost basis between $3,600 and $3,815, creating a potential resistance zone. This concentration suggests that many investors may opt to sell at breakeven, potentially stalling Ether’s upward momentum.Traders emphasize that ETH must convert the resistance between $3,700 and $3,900 into support to aim for higher highs above $4,000. Crypto analyst Ted Pillows noted in an X post that "$ETH failed to reclaim the $3,700 level and is now going down," adding that if ETH can reclaim this level, it will target the $4,000-$4,100 liquidity zone. Michael van de Poppe stated that the ETH/USD pair "needs to break the $3,800-3,900 area" to trigger a move towards all-time highs. Meanwhile, Jelle mentioned that bulls need to "step in further" to push ETH to $4,000, asserting that "the sooner we get back above $4K, the better." Cointelegraph also reported that Tom Lee’s BitMine accelerated its ETH accumulation last week, adding 110,288 Ether to its $12.5 billion treasury as it targets 5% of the total supply. This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.