Can Ethereum's price rise to $4,885 as exchange supply drops to a record low?

Ethereum price volatility (ETH) is drawing special attention from traders, as technical factors converge with an unprecedented “supply squeeze” phenomenon on centralized exchanges.

The combination of increasingly tight on-chain indicators and emerging chart patterns has laid the groundwork for expectations of a sustainable uptrend for ETH.

This update comes as the crypto market continues to adjust following Bitcoin’s (BTC) sharp swings and ongoing macroeconomic uncertainties.

Veteran trader Michaël van de Poppe believes ETH has established an ideal launch point for a recovery. He emphasizes that the support zone on the higher time frame has remained intact, marking the beginning of a broader reversal cycle.

Van de Poppe forecasts Ethereum will outperform Bitcoin in the near future, with the entire Ethereum ecosystem poised for strong development.

This assessment comes as the ETH/BTC pair tests a key support range from 0.031 to 0.034 satoshi—a zone he views as ideal for accumulation.

ETH/BTC Pair Tests Multi-Month Support Zone

The ETH/BTC chart shows Ethereum trading around 0.03440 against Bitcoin, sitting just above a support area maintained throughout 2024 and into early 2025.

The current technical structure suggests a potential double bottom formation, with a second test of the range from roughly 0.026 to 0.034 satoshi.

If the price holds this area, the next target will be 0.055—representing a potential upside of up to 60% against Bitcoin at current levels.

The daily timeframe shows a descending trendline has consistently capped rallies since mid-2024, with the price now consolidating just below this resistance area.

Traders see the current zone as a confluence of technical support factors, where the risk/reward ratio favors long positions—especially if Bitcoin continues to range or shows signs of distribution.

ETH Exchange Balances Drop To All-Time Lows

According to Milk Road, Ethereum is quietly entering its most significant supply squeeze phase to date. ETH exchange balances fell to just 8.84% of total supply as of December 5.

This marks a record low for ETH available on centralized exchanges. Meanwhile, Bitcoin still maintains about 14.8% of its supply on exchanges—nearly double Ethereum’s share, reflecting a stark contrast in supply dynamics between the two largest cryptocurrencies.

This tightening supply is mainly driven by ETH moving into staking contracts, restaking protocols, layer-2 activities, data layers, collateral loops, and long-term storage solutions.

These applications have pulled ETH out of liquid circulation, creating sustainable structural demand not reliant on speculative sentiment or short-term price swings.

Even as early December market sentiment turned somewhat bearish, Ethereum’s fundamental supply conditions continued to improve as tokens flowed off exchanges—where most sell pressure typically arises.

Milk Road emphasizes that market sentiment does not determine supply; Ethereum’s price remains quietly squeezed while the market awaits its next move.

Historical precedents show that persistent exchange balance declines often precede strong rallies, as reduced sell-side liquidity amplifies buying pressure when market momentum shifts.

Technical Targets for ETH: From $3,336 to $4,885

Trader Crypto Caesar predicts Ethereum will soon face resistance, though the overall reversal structure remains positive.

The daily ETH/USDT chart shows price currently in the $3,000 zone, testing support around $2,616, with key weekly resistance near $4,885.

This analysis highlights the breakout from a long-term descending channel in mid-2024, laying the foundation for the current accumulation range.

Caesar’s chart identifies several key price levels that will determine Ethereum’s direction in the coming weeks.

Ethereum price chart (ETH) daily | Source: CryptoCaesar/TradingViewThe $2,482 to $2,616 area is a strong support zone where previous rallies originated, while resistance above stretches from $4,789 to $4,885—matching the weekly peak for 2024.

Sustainable Growth Outlook for ETH

Trader Tim adds a short-term perspective, noting that while Bitcoin’s chart structure remains weak, Ethereum is showing relative strength. This is the only pair Tim is considering for a long position. The 4-hour chart of ETH perpetual contracts shows price at $3,067—just above last week’s low at $2,761 and the monthly open at $2,943.

Ethereum price chart (ETH) daily | Source: Trader Tim/TradingViewTim identifies the daily fair value gap as the preferred entry zone for longs, targeting last week’s high at $3,099 and potentially the yearly open at $3,336.

While acknowledging this setup is somewhat risky given Bitcoin’s weakness, Tim argues ETH’s daily structure remains firm and offers a better risk/reward ratio than other major cryptos. The fair value gap from $2,943 to $3,064 previously saw algorithmic buying activity and is expected to support price before the uptrend resumes.

Ethereum is currently consolidating above a key support zone with exchange balances at historic lows, while technical analysts outline potential upside targets.

Whether the convergence of tightening fundamentals and positive chart patterns can translate into sustainable growth will largely depend on Bitcoin’s stability and the return of risk appetite in the crypto market.

Nevertheless, structural changes in Ethereum’s on-chain economy suggest supply constraints will continue to drive long-term growth, regardless of short-term market sentiment shifts.

Ông Giáo