Ethereum Eyes $4200 as Bullish Signals and Golden Cross Align

Ethereum is flashing strong technical signals that suggest further upside, with analysts now eyeing $4200 as the next key target.

Ethereum price is showing strong technical strength, and analysts are now eyeing $4,200 as the next key target for the cryptocurrency.

As noticed by trader Merlijn The Trader, there has been a fresh Golden Cross on the daily chart. This occurs when the 50-day moving average crosses above the 200-day moving average, and it is often seen as a bullish signal.

The last time this happened was in December 2022, and it was followed by a 63% rally in ETH. However, The Trader notes that the current setup appears “even stronger” than the previous one.

This is also supported by the analysis of Titan of Crypto, who points to a broadening wedge pattern forming on the weekly chart. ETH has been climbing inside this structure, with the apex of the wedge and the upper resistance projecting around the $4,200 area.

Options Flow Shows Bullish Bias

On-chain data is also showing a bullish bias in the options market. According to Glassnode, the Put/Call open interest ratio has dropped to 0.43, while the Volume Ratio is at 0.63.

This indicates that there is more demand for bullish exposure, with traders placing more volume on calls than puts. At the current levels of both ratios, there is a strong bullish bias, according to the on-chain analytics firm.

The put/call ratio measures the amount of open interest in put options versus call options. Put options are a bet on the price going down, while call options are a bet on the price going up.

A high put/call ratio indicates that there is more demand for downside protection, which is typically seen in a bearish market. Conversely, a low put/call ratio suggests that traders are more bullish and willing to pay a premium for upside exposure.

The volume ratio measures the total volume of put options traded versus call options. A high volume ratio can indicate strong selling pressure, as traders are closing out their put positions and realizing losses.

In the case of Ethereum, the put/call open interest ratio has dropped significantly from its peak in December 2022. This shift is a strong indicator of the changing market sentiment.

As reported by AZCoin News, the last time the put/call options open interest ratio went below 0.5 was in December 2022. At the time, it was followed by a 63% rally in the ETH price.

Structure and Sentiment Align

With chart patterns, moving averages, and derivatives positioning all showing bullish signals, it seems that Ethereum is setting up for a continuation move to the upside.

If the bulls can maintain the current momentum and break through the Fib resistance in the coming days, then it could pave the way for a rapid rally toward the $4,200-$4,300 zone. This is where the broadening wedge and the weekly cloud resistance are both anticipated to come into play.