Ethereum (ETH) has finally reached an important milestone after nearly 8 months of sluggishness. The price of ETH has broken through the $4000 mark, and this breakthrough is not just a numerical significance, but a result of multiple factors working together.

From a technical analysis perspective, this breakthrough can be described as textbook perfect. ETH successfully broke through the long-term downtrend line, establishing a new upward trend that began at $3650. The significant increase in trading volume has further added credibility to this breakthrough, indicating that it is likely a genuine trend reversal rather than a temporary false breakout. The noticeable widening of the Bollinger Bands also suggests the possibility of significant volatility soon.

On-chain data is equally exciting. The daily transaction volume of the Ethereum network has surpassed the levels seen during the peak of the 2021 bull market, mainly due to the increase in stablecoin trading and ETH staking activities. This phenomenon reflects that the Ethereum network is fulfilling its actual use cases, rather than existing merely as a speculative tool. At the same time, the amount of ETH locked in decentralized finance (DeFi) protocols has also reached a new high, indicating strong internal demand within the ecosystem.

The shift in attitude among institutional investors is particularly significant. In the past week, the Ethereum ETF attracted over $1 billion in net inflows, with a single-day inflow reaching as high as $200 million. These funds primarily came from large institutional investors such as pension funds and insurance companies, whose participation signifies that Ethereum has gained recognition in the mainstream financial community.

The data from the options market is also worth paying attention to. According to Deribit, the trading volume of call options has reached three times that of put options, while implied volatility is also on the rise. This indicates that professional traders generally have a positive outlook on the further increase of Ethereum, with the next target price possibly around $4400.

Although the ETH price has performed strongly in the short term, investors still need to remain cautious. The high volatility of the cryptocurrency market means that prices can change dramatically at any time. Meanwhile, the uncertainty of the regulatory environment is also an important factor that requires ongoing attention. In any case, Ethereum's continuous progress in technological innovation and the expansion of application scenarios will be key factors supporting its long-term value.