Ethereum looks like it’s regaining its strength as traders and analysts note that the ETH has been displaying better pricing structures and a level of optimism about potential regulation in the United States. It appears that ETH may be preparing to head into a recovery level despite a cautiously optimistic market.

Ethereum Outperforms Coinbase Stock in Recent Bottom

Market analyst Ted Pillows observed that it looks like Ethereum has established a bottom before Coinbase (COIN) stock in this recent market correction. ETH and COIN generally moved in a correlated manner during risk on and off episodes in the crypto markets. But this time around, ETH has recovered first, which can be deemed a sign of relative strength.

This early bottoming action has indicated that there can be a short-term rally in Ethereum, before certain crypto-related assets experience a proper recovery. The data charts shown in expert analysis indicate the same: a sharp fall, a brief pause, a settlement, and an early rise, as observed previously.

Also Read: Vitalik Buterin Says Ethereum Still Has Work to Do Despite 2025 Gains

Technical Structure Suggests Potential Relief Rally

From a technical analysis point of view, it appears that the recent price trend of Ethereum shows signs of weakening selling pressure. The fact is that ETH has maintained the important support levels while creating higher lows.

Traders are waiting for the confirmatory evidence of high trading volumes and a move above nearest resistance levels. If there is momentum, Ethereum may perform better compared to other major cryptocurrencies in the short run, especially if risk sentiments improve.

Regulatory Optimism Builds Around Clarity Act

Apart from the technical elements, it is quite apparent that the changing trends in regulations are now emerging as a new long-term driver in the industry. The discussions on the new Clarity Act in the US market are in the news, and progress is expected as early as Q1 2026.

If this bill were to become law, it is likely that guidance on the classification, compliance, and supervision of digital assets will become much clearer. It appears that such a development could have a major benefit on Ethereum, which many regard as the building block of the decentralized finance or smart contract industry.

More clearly defined regulations could promote engagement with institutions, remove any potential for confusion for developers, and ultimately consolidate the position of the Ethereum network in the larger financial infrastructure.

Outlook: Strength Building Beneath the Surface

Although it is perhaps premature to speak of a definitive trend reversal, the recent trend with Ethereum indicates increasing resiliency. As long as the regulatory momentum is maintained and the levels can be sustained, ETH may very well be gearing up for a better trend in comparison with the rest of the crypto-sphere.

Also Read: Arbitrum Surpasses Ethereum Mainnet in Activity: Could It Push ARB to $1.24?

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Filed under: Bitcoin - @ January 3, 2026 5:00 am