While Ethereum (ETH) tries to turn a key level into support, some analysts have shared the bullish outlook for the cryptocurrency, which could push its price above the $4,000 barrier in the first quarter of 2026.

Year-end weakness could spark a Q1 rally

On Monday, Ethereum broke through the $3,200 barrier for the first time in almost a month, reaching a four-week high of $3,259. The cryptocurrency has surged 8.3% from the key $3,000 level since Friday, consolidating above the $3,100 level over the weekend.

Now the altcoin king is trying to hold the key resistance level and turn it into support. Amid these results, some market watchers shared a potential setup that could lead to significant growth over the next three months.

In post X, analyst Niels confirmed that Ethereum’s quarterly close in the red “isn’t as bearish as it seems.” It is worth noting that according to CoinGlass data, the altcoin recorded its worst fourth quarter in six years after closing the quarter with a negative rate of return of 28.28%.

This marks ETH’s first negative Q4 close since 2022 and the worst year-end result since 2019, when ETH recorded a negative rate of return of 28.9%. Nevertheless, Niels emphasized that this opens the door to an “interesting” setup ahead of the altcoin’s expected seasonality.

“History tells an interesting story: every time ETH ended Q4 in the red, the subsequent Q1 closed in the green,” the analyst explained, arguing that “year-end weakness tended to act as a reset, not a reversal.”

According to the post, year-end leverage smoothing and cooling sentiment have already enabled Ethereum to start the modern year “from a cleaner base,” allowing the altcoin to record quarterly returns of up to 52% in recent years.

“If this pattern continues, the fourth quarter was not a warning; it is a setup heading into the first quarter,” he suggested.

Ethereum is preparing for a 30% breakout

Analyst Ted Pillows says the price is seeing a weekly gain of 11%. pointed that the cryptocurrency will soon face an crucial zone that has been a resistance for almost two months.

Since the beginning of November, the largest altcoin by market capitalization has been trading in the price range of $2,700 to $3,400, encountering forceful resistance around the $3,000 and $3,200 levels.

Now that the middle zone of the range has been temporarily reclaimed, ETH needs to maintain its momentum and turn the upper boundary into support. “Recovering this level will push Ethereum towards the $3,800-$4,000 level,” where the next major resistance lies, Ted explained on Monday morning.

On the contrary, a rejection from this resistance zone could push the ETH price towards the support at $3,000, while risking a longer consolidation in its two-month range.

Meanwhile, analyst Ali Martinez discussed altcoin consolidation, indicating a symmetrical triangle pattern forming on the chart. According to the analyst, Ethereum has been compressing between ascending and descending trend lines since November, anticipating a 30% move.

If the price maintains its current break from the upper limit, the cryptocurrency could see a rally towards the $4,000 area in the coming weeks, positioning ETH to retest Q3 levels.

At the time of writing, Ethereum is trading at $3,253, up 3.4% on the daily time frame.

Featured image from Unsplash.com, chart from TradingView.com