Ethereum (ETH) is experiencing its strongest weekly rally since May 2021, driven by a combination of technical upgrades, macroeconomic optimism, and significant investor interest. The cryptocurrency has surged over 37.5% in the week ending 11 May, including a 10.3% rise in the past 24 hours alone, outperforming the broader crypto market.
Trade Developments Spark Market Optimism
The recent announcement of a trade agreement between the United States and the United Kingdom on 8 May, followed by renewed US-China trade negotiations, has sparked a wave of risk-on sentiment in global markets. This renewed confidence has extended to the cryptocurrency sector, lifting the price of Ether significantly.
Investors are reacting positively to the easing of geopolitical tensions and potential economic cooperation, which are seen as favourable conditions for risk assets like cryptocurrencies. While Bitcoin recently broke through the symbolic $100,000 mark, Ethereum has outpaced it in percentage gains.
Pectra Upgrade Enhances Ethereum Network
Ethereum’s Pectra upgrade, activated on 7 May, has introduced several key improvements that are bolstering investor confidence. Notably, the upgrade includes the implementation of EIP-7702, which introduces account abstraction to make Ethereum wallets more flexible and user-friendly. It also increases staking limits, making the network more scalable and efficient.
These developments have accelerated Ether’s growth. Since 8 May, ETH has risen by more than 34.3%, while the total cryptocurrency market capitalisation has increased by just 10.91% during the same period. Ethereum’s rapid gains reflect how the upgrade has helped distinguish it from other digital assets in the short term.
Short Squeeze Fuels ETH Price Surge
The recent price surge has also triggered a significant short squeeze in the Ethereum futures market. Since 8 May, approximately $437.94 million worth of short positions have been liquidated, as traders betting against ETH were forced to buy back the cryptocurrency to cover losses. This buying pressure further fuelled the rally.
Meanwhile, $211.29 million in long liquidations have also taken place, highlighting heightened volatility in the market. Ethereum’s open interest — the total value of all outstanding futures contracts — has jumped from $21.28 billion to $26.77 billion within just two days.
Additionally, weekly funding rates for Ethereum perpetual futures have increased from 0.10% to 0.15%, indicating that more traders are opening long positions and are willing to pay premiums to maintain them. Together, these trends suggest growing bullish sentiment among futures traders.
Mega-Whales Accumulate Ether in Anticipation of Gains
The rally has coincided with notable accumulation of Ether by “mega-whales” — wallets holding over 10,000 ETH. Data from Glassnode shows that the net position change for these wallets has turned positive since late April, with holdings rising to their highest level since March 2025, exceeding 40.75 million ETH.
This trend signals confidence among large investors who are positioning themselves for continued price appreciation. Their actions often influence broader market sentiment, encouraging retail traders and smaller investors to follow suit.
Technical Analysis Points to $3,400 Target
From a technical standpoint, Ethereum is currently bouncing off a long-term ascending support line, part of a larger symmetrical triangle pattern visible on the monthly chart. Historically, ETH has shown strong rallies each time it has touched this trendline.
This pattern now suggests a potential price target near $3,400, representing a 40% gain from current levels. Prominent market analyst Peter Brandt has echoed similar bullish sentiments, forecasting a potential “moonshot” for Ether in the coming months if momentum continues.
With positive macroeconomic signals, strong network upgrades, bullish technicals, and large investor confidence aligning, Ethereum appears well-positioned for further upside.
