The latest market data reflects growing optimism among traders that Ethereum’s current consolidation phase may be nearing its end.

Ethereum Price Stabilizes Above $3,200 Support

Ethereum’s weekly chart highlights a crucial support hold around $3,130–$3,200, aligning with the 50-week moving average (WMA) and the 0.618 Fibonacci retracement zone. This technical confluence has historically served as a springboard for major recoveries in previous cycles.

Ethereum holds firm at the $3,130 support on the 50 WMA and 0.618 Fib, fueling hopes for a rebound toward $4,000. Source: @TheLongInvest via X

Market analyst @TheLongInvest noted that ETH ($3,442.77) “very nicely held support on the 50 WMA and the 0.618 Fib at $3,130,” adding that a move back toward $4,000 could signal that the worst of the correction is over.

Oversold RSI Suggests Reversal Momentum

On the technical front, the Relative Strength Index (RSI) on the weekly chart has fallen near 37, marking oversold territory. Analyst @CryptoCaesarTA described Ethereum as “oversold,” highlighting that previous RSI dips to similar levels in 2024 and 2025 preceded strong upward reversals.

Ethereum enters oversold territory, hinting at a potential bullish reversal ahead. Source: @CryptoCaesarTA via X

Such oversold readings often indicate that selling pressure has been exhausted, opening the door for a rebound. The analyst’s chart projected a bullish trajectory toward the $5,000–$5,500 region by mid-2026, echoing historical patterns of post-halving recoveries.

Bear Trap Theory Gains Traction

Adding to the bullish narrative, @AshCrypto described Ethereum’s recent dip below $3,500 as a “massive bear trap,” suggesting that the market could be setting up for a sharp upside breakout. His analysis pointed to a descending channel formation that mirrors pre-breakout structures from previous Ethereum cycles.

Ethereum’s latest dip looks like a classic bear trap, with traders still eyeing a rebound toward $5,000 in 2025. Source: @Ashcryptoreal via X

Despite short-term volatility, many community members continue to show “cautious optimism,” revising prior targets from $7K–$10K down to $5K but maintaining a long-term bullish stance.

Broader Outlook and Market Catalysts

Ethereum’s technical stability is supported by positive ecosystem developments, including steady growth in Layer-2 scaling solutions and renewed institutional interest following ETF inflows. Analysts note that Ethereum’s network fundamentals remain strong, with on-chain activity and staking yields gradually improving despite broader market fatigue.

Historically, Ethereum’s post-halving performance has been impressive—the asset rallied more than 2,000% from its 2020 halving low to its 2021 peak. If similar cyclical trends repeat, ETH could experience substantial upside once current consolidation phases conclude.

However, risks remain. A decisive drop below $3,200 could open the door to further downside, potentially testing $2,600 support levels. Broader macroeconomic factors, including interest rate decisions and ETF-related outflows, may also influence near-term volatility.

Final Thoughts

Ethereum’s ability to maintain the $3,200 support zone, coupled with oversold RSI conditions, reinforces the probability of a technical rebound. A successful reclaim of the $3,500–$3,700 resistance zone could validate bullish momentum and set the stage for a rally toward $5,000 in the coming months.

Ethereum (ETH) was trading at around $3,229, down 3.04% in the last 24 hours at press time. Source: Ethereum Price via Brave New Coin

For now, Ethereum appears to be stabilizing as traders weigh macro uncertainty against improving on-chain fundamentals. The convergence of technical signals, historical patterns, and ecosystem resilience suggests that Ethereum may be preparing for its next significant move higher.