Ethereum’s [ETH] price could hike by 22% to hit $3,500 ONLY if…

Following a substantial decline in cryptocurrency prices, there has been a noticeable shift in market sentiment. Ethereum (ETH), the second-largest digital currency globally, seems to be attracting greater attention from cryptocurrency experts and investors, suggesting a change in prevailing market sentiment.

Massive $180 million ETH Outflows

Recent data from 06 February indicates that investors and long-term holders have been actively purchasing ETH, possibly capitalizing on the recent price dip. Data on inflows and outflows of ETH from exchanges highlight outflows totaling $180 million over the past 48 hours, possibly signaling accumulation.

The significant outflows from exchanges can potentially drive buying pressure, fueling an upward trend in the market.

Short Positions and Liquidation Thresholds

In contrast to the positive sentiment among long-term holders and investors, intraday traders appear to be leaning towards a bearish outlook, especially given the prevailing market sentiment.

The ETH exchange liquidation data indicates that traders might be overly leveraged at both the $2,712 and $2,870 levels, hinting at crucial support and resistance levels for the altcoin.

If the market sentiment remains unchanged and ETH’s price drops to $2,712, nearly $365 million worth of long positions could get liquidated. Conversely, if the sentiment shifts and the price surpasses $2,870, around $406 million worth of short positions might face liquidation.

These liquidation thresholds imply that bullish investors are relatively weak, while traders with short positions have been controlling the asset at an intraday level.

Long-Term Critical Levels in Expert Focus

In a longer time frame perspective, well-known crypto analyst Ali noted on X (previously known as Twitter) that if ETH holds above $2,500, there is a strong likelihood of it rebounding to $4,000 or even $6,000 in the future.

However, failing to maintain this level could result in ETH dropping to the next support level of $1,700 if it closes a daily candle below $2,500.

Price Action and Future Outlook

Additionally, technical analysis from CryptoCrypto suggested that ETH is currently hovering near the critical support level of $2,800. This juncture is pivotal for the cryptocurrency since it has consolidated around this mark for the last three days.

Based on recent price movements, crossing above the $2,880 level could potentially propel ETH by over 22% towards the $3,500 threshold in the future. Conversely, if ETH’s price decreases further and closes below $2,720 on a daily candle, there could be a downtrend towards $2,200 in the future.