Ether (ETH) is fighting to maintain its momentum above the $2,600 resistance level, following a significant 15.1% price surge between Sept. 18 and Sept. 23. With $2.78 billion in Ether options set to expire on Sept. 27, market participants are closely watching how this could impact price trends in the coming days. Bulls are hoping to continue their rally, but holding above $2,600 may prove challenging.
Factors Driving Ether’s Recent Gains
Ether’s recent price increase has largely been fueled by macroeconomic factors, particularly a shift in the U.S. Federal Reserve’s monetary policy. The Fed’s decision to ease interest rates has led to a more accommodative environment, boosting investor confidence. This resulted in the S&P 500 reaching a new high on Sept. 24, and the falling yields on U.S. 2-year Treasury bonds further signaled investors’ growing concerns about a potential recession. These trends have spurred interest in cryptocurrencies like Ether, which are often viewed as alternative, scarce assets in uncertain times.
Despite the recent rally, Ether is still down 33% over the last four months. This decline followed the launch of a highly anticipated spot exchange-traded fund (ETF) in the U.S., which disappointed many, leading to significant outflows totaling $684 million, according to Farside Investors.
The Battle Between Bulls and Bears
The upcoming $2.77 billion in open Ether options includes $1.82 billion in call (buy) options and $0.95 billion in put (sell) options. While bulls appear to hold the upper hand, with $1.47 billion in call options targeting prices above $2,700, these positions will expire worthless if Ether remains below this level by Sept. 27. On the other hand, bears could still tip the scales in their favor if the price fails to hold above $2,600.
Adding to the pressure on Ether’s price is increased network activity. Transactions on the Ethereum blockchain spiked by 15% leading up to Sept. 24, pushing the average transaction fee to over $4.50—up significantly from $1.45 just ten days prior. This higher demand for Ethereum’s smart contract processing capabilities suggests continued interest in the network, though it has also raised concerns about the sustainability of Ether’s recent price gains.
At the same time, Ether’s supply has increased. Data from Ultrasound Money shows that 58,856.4 ETH was added to the supply in the past 30 days, marking an annualized inflation rate of 0.6%. Coupled with rising competition from cheaper alternatives like Solana and BNB Chain, both offering transaction fees more than 20 times lower than Ethereum’s, some investors are worried that Ether’s upward potential may be capped.
The Road Ahead for Ether Bulls
For Ether bulls to regain control, the price must rise above $2,700 before the Sept. 27 options expiry. This would allow call options to secure a substantial $220 million advantage. However, bears remain in a strong position to capture a $100 million advantage if the price continues to hover near the $2,600 support level, which is being tested frequently.
The outcome of this options expiry could provide a clear direction for Ether’s short-term price movement. Bulls are banking on maintaining recent momentum, but bears still have a path to victory if current support levels fail to hold.
