Ethereum Price Surge: Factors Behind ETH’s Current Rally

Ethereum’s price has surged over 37.50% this week, marking its best performance since May 2021. Key drivers include the recent Pectra upgrade, substantial short liquidations, and increased accumulation by mega-whales. Analysts suggest a potential rally towards $3,400, while cryptocurrency market sentiment improves following US trade agreements.

Ethereum (ETH) is experiencing a notable surge, with its price poised for its best weekly performance since May 2021. The cryptocurrency has seen an impressive hike of over 37.50% for the week ending May 11, marking a substantial increase of 10.30% just in the past 24 hours. The spiritual factors driving this rally include the recently announced Pectra upgrade and massive short squeezes in the futures market, alongside robust buying interest from large investors, colloquially known as “whales.”

On May 8, news of a new trade agreement between the US and UK emerged, while concurrent talks between the US and China further lifted market sentiment. Consequently, Ethereum has had the wind at its back, significantly benefitting from its Pectra upgrade initiated on May 7, which introduced several enhancements aimed at improving the staking process and overall account flexibility through EIP-7702. These advancements have made Ethereum’s price momentum outpace the overall cryptocurrency market, which had only increased by about 10.91% during this timeframe.

Short liquidations within the Ethereum Futures market are adding to ETH’s upward trajectory as traders betting against the cryptocurrency are compelled to reverse their positions. Reportedly, more than $437.94 million in short positions were liquidated since May 8, alongside $211.29 million in long position liquidations. This influx of purchases made by short-sellers to limit losses is pushing prices even higher. Furthermore, there has been a notable surge in Ethereum’s open interest, rising from $21.28 billion to $26.77 billion—highlighting growing trader interest.

Adding more fuel to the fire, data from Glassnode suggests that mega-whales, who are entities holding more than 10,000 ETH, are increasing their stakes. Their net positions flipped to positive at the end of April, as their total holdings climbed to levels not seen since March 2025, surpassing 40.75 million ETH. This accumulation reflects confidence among large investors in the price trajectory of Ethereum and adds a bullish sentiment to the broader market.

Moreover, Ethereum is currently bouncing off a critical long-term support line, which has been evident in its monthly chart. This activity forms a symmetrical triangle pattern, suggesting a potential rally towards the upper trendline at around $3,400, translating to an increase of about 40% from current price levels. Historically, such support bounces have resulted in significant rallies, further supporting optimistic projections about ETH’s future potential and aligning with analysts’ views that anticipate considerable upward movement.

However, it’s vital to note that this article does not serve as investment advice. Any changes in investment strategies or trading decisions come with inherent risks, and thorough personal research is always advisable before making financial decisions.