Can Ethereum Price Hit $4,000 as Global M2 Money Supply Soars and DXY Declines?

Ethereum (ETH) is poised for a significant price rally in the near future due to a confluence of macroeconomic factors and technical patterns. A sharp decline in the US Dollar Index (DXY) coupled with the expansion of the Global M2 Money Supply add credence to that the risk-on assets are likely to rally. The Wyckoff Accumulation pattern noted on ETH price adds further credence that a bullish reversal to potentially $4,000 is likely.

DXY Decline and Global M2 Surge: A Tailwind for Ethereum Price?

The U.S. Dollar Index (DXY), which measures the dollar’s strength against a basket of major currencies, dropped 3.90% since February 28, 2025. A weaker dollar typically boosts risk assets like cryptocurrencies as investors seek higher returns in alternative investments. So, investors can expect the declining dollar to boost Bitcoin and Ethereum prices higher.

Can Ethereum Price Hit $4,000 as Global M2 Money Supply Soars and DXY Declines?Can Ethereum Price Hit $4,000 as Global M2 Money Supply Soars and DXY Declines?
Dollar Index

Additionally, the global M2 money supply, which is a broad measure of money in circulation, including cash, checking deposits, and other liquid assets, has also risen by 1.87%, from $105.4 trillion to $107.4 trillion since mid-January 2025. This expansion in liquidity is a perfect combination that further pushes investors to seek higher returns in risk assets. History shows that similar conditions have driven crypto bull cycles in the past and could catalyze a rally for Bitcoin and Ethereum prices as well.

Can Ethereum Price Hit $4,000 as Global M2 Money Supply Soars and DXY Declines?Can Ethereum Price Hit $4,000 as Global M2 Money Supply Soars and DXY Declines?
Global M2 Money Supply

Crypto analyst Sam Mandal noted,

“Ethereum thrives in environments of loose monetary policy and increased liquidity. The combination of a declining DXY and a rallying global M2 money supply creates an ideal setup for Ethereum to capitalize on market momentum.”

Ethereum’s Wyckoff Accumulation Pattern: A Springboard to $4,000 and Beyond?

Adding to the macroeconomic bullish narrative is Ethereum price action forming a Wyckoff Accumulation pattern, as noted by prominent crypto analyst Louie. According to his recently shared post on X, ETH is in the “spring” phase, which is often followed by a bullish reversal if certain conditions are met. The spring phase is when price dips below key level, indicating a potential smart money accumulation.

In the post, Louie highlighted that if Ethereum price recovers above the key support level at $2,300, it could kickstart a bullish reversal. In such a case, ETH’s value could explode to the next key hurdle at $4,000. 

“Smart money thinks in terms of years, not weeks,” Louie wrote, emphasizing the long-term accumulation strategy at play. Depending on the momentum at $4,000, he hinted that bullish Ethereum price prediction could extend its rally to $5,000, driven by strong market sentiment and technical support.

Can Ethereum Price Hit $4,000 as Global M2 Money Supply Soars and DXY Declines?Can Ethereum Price Hit $4,000 as Global M2 Money Supply Soars and DXY Declines?
ETH/USDT 2-day chart

Conclusion: Ethereum’s Bright Future Ahead

As of March 8, 2025, Ethereum appears primed for a significant price rally, driven by a weakening U.S. dollar, expanding global liquidity, and a textbook Wyckoff accumulation pattern. With the DXY down 3.90% since February 28 and global M2 money supply up 1.87% since January, the macroeconomic environment is highly favorable for risk assets like ETH. Combined with technical signals pointing to a recovery above $2,300 and a potential target of $4,000 or $5,000, Ethereum investors have reason to be optimistic.

Frequently Asked Questions (FAQs)

A sharp decline in the US Dollar Index (DXY) and an expansion of the Global M2 Money Supply are creating a favorable environment for risk assets like Ethereum.

The Wyckoff Accumulation pattern suggests that Ethereum is poised for a bullish reversal, with a potential target of $4,000 or higher.

If Ethereum price recovers above $2,300, it could kickstart a bullish reversal, potentially driving the price to $4,000 or higher.

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Akash Girimath

Senior Cryptocurrency Analyst & Market Strategist
Engineer-turned-analyst Akash Girimath delivers data-driven insights on cryptocurrency markets, DeFi, and blockchain technology for platforms like AMBCrypto and FXStreet. Specializing in technical analysis, on-chain analytics, and risk management, he empowers institutional investors and retail traders to navigate market volatility and regulatory shifts.

A hands-on strategist, Akash merges active crypto portfolio management with research on Web3, NFTs, and tokenomics. At AMBCrypto, he led cross-functional teams to redesign content frameworks, achieving record-breaking traffic growth through scalable editorial strategies. His analyses dissect market sentiment, investment strategies, and price predictions, blending macroeconomic trends with real-world trading expertise.

Known for mentoring analysts and optimizing workflows for high-impact reporting, Akash’s work is cited across global crypto publications, reaching 500k+ monthly readers. Follow his insights on YouTube, X, and LinkedIn for cutting-edge perspectives on decentralized ecosystems and crypto innovation.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

Source: https://coingape.com/markets/can-ethereum-price-hit-4000-as-global-m2-money-supply-soars-and-dxy-declines/