Ethereum price consolidation over the past few weeks, coupled with its lackluster performance in 2024 and 2025, has caused investors to lose hope. However, very few analysts believe that ETH could be ready for a massive uptrend. With Vitalik Buterin’s assurance that the blockchain will never abandon its values and short-term holders capitulating, Ethereum price may be primed for a massive rally to $5,000 in February 2025.
Ethereum performance in 2024 was disappointing. In 2025, while Bitcoin (BTC) is up 8%, ETH price today is around -1.4%. However, this outlook might have changed during month-end volatility that caused a massive capitulation.
Ethereum Price Crash Triggers Holder Capitulation, Trend Reversal Likely
On January 31, Ethereum price rose 5.87%, which was nothing unusual, but closed the day at a 1.65% gain. This sudden uptick and reversal, according to Santiment data, caused a massive capitulation. The Network Realized Profit/Loss (NPL) indicator flashed capitulation as 601 million ETH were exchanged at a loss.
History shows that these capitulations are bottom signals, and price often kickstarts an uptrend soon thereafter. Here are some examples where capitulation was followed by double-digit uptrends:
On August 5, 2024, when this indicator flashed capitulation signal, Ethereum price shot up 29% in the next three days.
On September 10, 2024, ETH reversed 6% in three days but extended the gains to 17% in the next two weeks.
Although the capitulation on November 19, 2024, was relatively small, it led to a 33% rally in the next 17 days.
ETH Network Realized Profit/Loss
The Market Value to Realized Value (MVRV) Ratio shows a similar outlook to the NPL indicator and confirms that capitulation could be from short-term holders.
The 30-day, 60-day and 90-day MVRV that shows the average profit or loss of investors who purchased ETH in the past 30, 60 and 90 days ago sits at 0.62%, -3.88%, -2.36%, respectively. Only the 180-day MVRV hovers around 6.32%, which is the average profit of investors that purchased ETH 180 days ago.
ETH 30, 60, 90, 180-day MVRV
With many short-term holders sitting at a loss, the probability of Ethereum price triggering a reversal is high.
Is $5,000 Possible in February 2025?
There are multiple signs that suggest Ethereum price could hit $5,000 in February 2025. The first data point is the historical returns, which indicates that returns in the post-halving years are supporting altcoin rally.
Furthermore, the daily chart shows Ethereum price is hovering inside a falling wedge setup. This pattern is formed by connecting ETH’s four lower highs and three lower lows since December 16, 2024. This technical formation forecasts Ethereum price target of $4,000 after a 17% rally. This target is obtained by adding the distance between the wedge’s first swing high and swing low to the breakout point of $3,222.
ETH/USDT 1-day chart
While the falling wedge is bullish, here are key resistance levels that could threaten the uptrend: $3,592, $3,975, and $4,069. Once the $4,000 psychological level is cleared, ETH will attempt a revisit to its ATH at $4,877. After clearing this level, Ethereum price prediction hints at a retest of the $5,000 psychological level.
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