Ethereum (ETH) price prediction: After a big pump of 18.8% in August, a key September awaits. Breaking through $5000 may start the journey to $10,000.

Ethereum surged by 18.8% in August, significantly outperforming the crypto market's average rise of 14%, mainly benefiting from stronger capital inflows into the Ethereum ETF compared to the Bitcoin ETF. However, historical data shows that Ethereum has a high probability of falling in September after a strong August: after a 25.3% rise in August 2020, it fell by 17% in September; after a 35.6% rise in August 2021, it fell by 12.5% in September; and after a 13.4% rise in August 2023, it fell by 11.3% in September. Currently, over 96% of ETH addresses are in profit, creating significant profit-taking pressure. Technically, a symmetrical triangle consolidation pattern is forming on the 4-hour chart, and the breakout direction will determine the short-term trend, with key resistance at $5000 and support level at $4212.

Historical seasonal patterns indicate a September pullback risk, with profit addresses accounting for 96%

According to Glassnode data, currently over 96% of external holding addresses (EOA) of Ethereum are in profit, which means that the vast majority of investors have a holding cost lower than the current market price. Historical experience shows that when the proportion of profitable addresses reaches such a high level, the profit-taking pressure often leads to a price pullback. This risk highly aligns with Ethereum's historical seasonal performance: after a rise of 25.3% in August 2020, there was a fall of 17% in September; after a rise of 35.6% in August 2021, there was a fall of 12.5% in September; and after a rise of 13.4% in August 2023, there was a fall of 11.3% in September. This pattern is consistent with the traditional stock market's weak performance in September, as the S&P 500 index has had an average return of -1.2% in September since 1928, which analysts attribute to portfolio rebalancing after summer gains, tax loss harvesting, and position adjustments before the fourth quarter.

The technical analysis shows a symmetrical triangle consolidation, and the breakout direction will determine the short-term trend

(Source: TradingView)

The 4-hour chart shows that Ethereum is consolidating within a symmetrical triangle, a pattern that typically forms after a strong rise, with prices converging between lower highs and higher lows. If it successfully breaks through the upper resistance of the triangle, the technical target is around $5300, representing a potential rise of over 20% from current levels. Immediate resistance is at the 50-period exponential moving average (EMA) at $4464, while the 200-period EMA at $4212 serves as key support. A valid drop below the 200-period moving average would invalidate the bullish outlook and open up deeper correction space. On Sunday, Ethereum's price rebounded by 3% to $4491, down 8.13% for the week but still up 24.39% for the month, recently achieving a historical high of $4948.

Whales and institutional funds rotation accelerates, converting $433 million BTC to ETH in a single day

On-chain data shows that a legendary Bitcoin whale sold 4,000 BTC (approximately $435 million) in a single day on August 31 and purchased 96,859 ETH (approximately $433 million). Previously, the whale sold 1,000 BTC for $109 million in ETH on the Hyperliquid platform. Overall, the whale currently holds over 800,000 ETH (worth nearly $4 billion), most of which has been staked for yield.

Arkham Intelligence data shows that the investor transferred a total of $1.1 billion in BTC over the past week while acquiring approximately $2.5 billion in ETH. This aggressive capital rotation reflects a shift in institutional preferences, with BlackRock's Ethereum Trust (ETHA) purchasing nearly $968 million in ETH last week. The U.S. spot ETH ETF saw inflows of $3.87 billion in August, with total inflows exceeding $11 billion since April. In contrast, the U.S. spot Bitcoin ETF is expected to see a net outflow of $751 million in August, ending a trend of four consecutive months of inflows.

Analysts are optimistic about the long-term prospects, breaking through $5,000 may initiate a journey towards $10,000

Despite the short-term adjustment risk in September, market analysts remain optimistic about the long-term prospects of Ethereum. Analyst Crypto Patel pointed out that if ETH breaks through the key $5000 resistance level, it could trigger a pump towards the $10000 target. Companies like BitMine and SharpLink have established large ETH reserves, collectively holding over 2.5 million ETH. As whales and institutions continue to rotate into Ethereum, the market's focus is on whether a key breakthrough can be achieved in September. Investors need to closely track ETF fund flow data, changes in on-chain profitable addresses, and the breakthrough of key technical levels, as these factors will collectively determine Ethereum's final trend in September.

Conclusion

After reaching a historic high, Ethereum enters a critical September, with historical seasonal patterns and the high proportion of profitable addresses indicating short-term pullback risks. However, the rotation of institutional funds and technical breakout patterns still retain bullish potential. The massive transfer of assets from Bitcoin to Ethereum by whales, combined with the differences in ETF fund inflows, shows an increasing recognition of Ethereum's long-term value by institutional investors. While investors enjoy the gains from August, they need to remain vigilant about the traditional weakness period in September, focusing on the defense of the support level at $4212 and the momentum for breaking through the resistance level at $5000. These technical level breakthroughs will determine the directional choice for the next phase.