Ethereum (ETH) is showing renewed strength, with its price climbing nearly 2% over the last 24 hours to trade around $3,870. This upward movement comes as traders and investors position themselves ahead of a crucial United States inflation report, an economic release expected to influence the broader crypto market.

While Ethereum experienced a correction earlier in the month, a combination of technical and fundamental signals now points toward growing optimism. The recent price recovery is supported by positive macroeconomic sentiment, a rebound in institutional interest, and healthy on-chain metrics. The market is closely watching the upcoming Consumer Price Index (CPI) data, as the results will likely shape the Federal Reserve’s next policy moves.

Macroeconomic Optimism and Inflation Expectations

A primary driver behind Ethereum’s recent climb is growing optimism surrounding the US inflation figures. Many investors anticipate that the rate of price increases will either hold steady or slow, which would reduce pressure on the Federal Reserve to pursue further interest rate hikes. If the CPI report meets or comes in below expectations, it could reinforce the central bank’s shift toward a more lenient, or “dovish,” monetary policy.

This sentiment is already being priced into the market. The possibility of lower inflation and potential interest rate cuts has triggered positive movement across various asset classes, as traders prepare for looser financial conditions.

Broad Market Recovery Lifts Ethereum

Ethereum’s gains aren’t happening in isolation; they are part of a wider recovery in the digital asset market. According to data from CoinGecko, the global cryptocurrency market capitalization has increased by approximately 1.6% in the past day, reaching about $3.79 trillion. The rally has been widespread, with over 80 of the top 100 tokens posting gains.

This trend reflects a renewed risk appetite among investors, who are once again allocating capital to large-cap cryptocurrencies. The simultaneous recovery across major assets suggests that Ethereum’s current strength is fueled by easing macroeconomic pressures that are benefiting the entire sector.

Strong On-Chain Activity and DeFi Growth

The underlying health of the Ethereum network is also providing significant price support. On-chain data reveals a positive trend in staking participation, while the Total Value Locked (TVL) in major Decentralized Finance (DeFi) protocols has begun to recover after a recent dip. Platforms like Lido and EigenLayer have seen combined inflows of over $400 million in the past 24 hours, signaling robust user engagement in staking and liquidity provision.

With this latest increase, ETH is approaching a key resistance level around $3,890. A decisive break above this point on strong trading volume could pave the way for a further climb toward the next short-term resistance at approximately $4,090.

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