Ethereum Approaches Upper Realized Price Band Indicating Potential Profit-Taking

Ethereum experienced significant price fluctuations this week, briefly dropping below $4,200 before rebounding to a new all-time high of $4,886. Key factors influencing this volatility include:

Institutional accumulation
Declining supply on exchanges
Increased DeFi activity

Analyst Darkfost noted that Ethereum is nearing its upper realized price band, which could signal profit-taking among investors and indicate overheated market conditions. Historically, these instances have led to potential pullbacks.

Market Indicators

The Realized Price Bands indicator shows critical valuation levels for Ethereum. The lower band indicates accumulation by long-term holders, while the upper band suggests potential profit-taking. Sustaining a position near or above this upper band may lead to increased speculative flows but risks subsequent corrections.

Price Action Overview

ETH's 4-hour chart reveals a strong recovery from $4,200, currently trading around $4,767. Notable movements include:

Clearing both the 50-day and 100-day moving averages, now acting as support
A recent green candle indicating renewed bullish momentum
Consolidation above the 200-day moving average, reinforcing the bullish trend

If bulls maintain support above $4,400, Ethereum could retest its all-time high. A drop below this level might lead to revisiting $4,200, where support must hold to prevent deeper retracement.