Ethereum (ETH) is exhibiting a strong historical pattern of recovery following a significant downturn in the fourth quarter of 2025. According to data from Coinglass, ETH ended Q4 2025 with a loss of 28.28%, driven by year-end selling pressure and a loss of market sentiment. However, historical analysis reveals a consistent bullish tendency in subsequent quarters.
Historical Pattern Favors Upside
Examining past red Q4 periods for Ethereum—in 2016, 2018, 2019, and 2022—shows that Q1 became positive in every instance, with even greater gains typically following in Q2. On average, Q1 gains reached 139%, while Q2 averaged 158%. Early 2026 data aligns with this pattern, with ETH already up 6.57% in Q1 as market confidence slowly returns.
Technical Momentum Improves
From a market structure perspective, Ethereum has rebounded from late-December lows near $2,700. On January 5, 2026, ETH surged to $3,238, breaking above its critical 50-day moving average near $3,008. Momentum indicators like the Relative Strength Index (RSI) support the recovery, though short-term overheating suggests the possibility of brief consolidation before further upward moves.
Analysts note a cautionary signal in derivatives data: open interest declined during the recent rally, indicating part of the price increase was driven by position closures rather than fresh leverage. This is seen as a potential sign for a market reset through sideways movement or a shallow pullback to restore balance.
Long-Term Price Projections and Institutional Backing
Longer-term price predictions remain constructive but conditional. Using a Fibonacci extension framework, analyst Freedom_By_40 suggests a conservative cycle target near $6,400, with potential upside extensions toward $10,000–$18,000. More aggressive Elliott Wave interpretations point to a potential wave 5 rally with targets of $8,500–$11,000.
These projections are bolstered by growing institutional support. BlackRock's ETHA ETF has become the largest spot Ethereum ETF by assets under management, with a market cap of approximately $11.1 billion. Grayscale recently delivered its first staking reward to Ethereum Trust ETF holders, marking a milestone for US-listed crypto ETFs. Total US-listed spot Ethereum ETFs now manage nearly $18 billion.
Key Levels and Outlook
Technically, key resistance lies around $3,250–$3,300. A sustained move above this zone could open the path toward $3,600–$4,000. Support levels are between $3,050 and $3,130. While the short-term trend is constructive, analysts emphasize that continuation toward higher long-term targets remains contingent on sustained ETF inflows, on-chain activity, and broader market support, rather than momentum alone.
