Key Points Summary:
Ethereum has reclaimed a key level that previously triggered over 100% gains and marked the beginning of past altcoin seasons.
If Bitcoin's dominance repeats a decline post-halving, the altcoin market cap could soar to $15 trillion.
Despite bullish signals, Ethereum remains vulnerable, with its price near the cost basis of $123 billion supply facing the risk of turning into losses.
Ethereum's native token has reclaimed a critical technical level that has historically indicated significant price increases and marked the start of "altcoin season" during multiple market cycles over the past five years.
The level in question is the midpoint of the Gaussian channel (around $2,600) — a channel based on moving averages that tracks long-term momentum — located on the two-week chart.
ETH/USD two-week price chart. Source: TradingView
In 2020-2021, Ethereum surged from $400 to over $4,800 after breaking the Gaussian midpoint. A similar rally at the end of 2023 saw Ethereum climb from below $1,500 to nearly $4,000 within a year.
In both cases, as momentum built, Ethereum quickly broke above the upper boundary of the channel.
As of May 2025, this upper boundary is near $3,200, becoming the next key resistance level. Breaking this level could pave the way to reach the previous cycle high of $4,100 before July.
Market analyst Moustache referenced the same Gaussian channel pattern, noting that a rise in Ethereum's price could further drive a synchronized rise in the broader altcoin market.
Source: Moustache
In the year following Ethereum's closing price above the channel midpoint in July 2020, the total market cap of altcoins, excluding Ethereum, surged by over 1,400%.
Similarly, in the year following Ethereum's breakout above the midpoint in November 2023, the altcoin market cap grew by over 200%.
ETH/USDT two-week price chart. Source: TradingView
The outlook for the 2025 altcoin season is bolstered by the repeating pattern following Bitcoin's halving.
In 2017 and 2021, Bitcoin's dominance significantly declined about 400 days post-halving, triggering a rise in altcoins. With the halving in April 2024 approaching, a similar decline may occur in the next 100 days.
BTC.D performance chart. Source: Wimar X
Analyst Wimar X predicts that if this trend repeats, the altcoin market cap could soar to $15 trillion.
According to Glassnode's on-chain data, the largest portion of Ethereum's market cap — approximately $123 billion — is held by investors who purchased between $2,300 and $2,500.
Ethereum market cap profit and loss situation. Source: Glassnode
If Ethereum's price even slightly dips below this range, a large number of holders will fall into a loss position. This could increase the risk of panic selling, adding pressure to the market.
Therefore, despite Ethereum showing technical strength, its support remains weak unless it can move further away from this cost range.
Related: Bitcoin (BTC) profit-taking trend continues, but breaking $115,000 will liquidate $7 billion in short positions.
This article does not contain any investment advice or recommendations. Any investment and trading activities involve risks, and readers should conduct their own research before making decisions.
Original article: “Ethereum (ETH) Flashes ‘Altcoin Season’ Signal, Price Aiming for $4,100”
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