Ethereum (ETH) has been declining for the fifth consecutive month. But that’s what will come into May with growing optimism. Historical trends, on-chain data, whale accumulation behavior, and upcoming technical upgrades form a strong foundation for potential price rebounds.
Below are four important reasons why analysts believe ETH can recover strongly in May.
Why Ethereum will recover in May 2025
The first reason comes from the historical price performance of ETH. Coinglass data shows that May is usually the best performance month for ETH.
Over the years, ETH has averaged 27.36% returns in May, the highest of all months.
Ethereum monthly price performance. Source: Coinglass
While not all May ends in profit, historical trends suggest that this month will usually bring positive emotions and upward momentum to ETH. Given current conditions, Cyclop expects ETH to maintain growth this month, reaching its $2,500 target.
“May has historically been the best month for ETH, and it’s $2,500 by the end of the month,” predicted analyst Cyclop.
Another important factor supporting the bullish outlook is on-chain data, particularly MVRV (market value to realised value) ratio. According to analyst Michael Van de Poppe, ETH’s MVRV ratio is currently the lowest since March 2020, when the Covid-19 pandemic had a major impact on the crypto market.
Ethereum MVRV. Source: GlassNode
The low MVRV ratio suggests that ETH is underestimated compared to its on-chain value. This signal has only been shown six times in the last decade, and in many cases preceded a massive recovery. The chart also shows that ETH could experience significant growth within the next three to 12 months.
The third sign of bullishness is the recent accumulation behavior of whales. According to Cryptoquant, these investors will not abandon their strategies even if ETH prices fall, and many of the accumulated addresses remain in unrealized losses.
Instead, they increased their ETH holdings.
On March 10th, the accumulated address held ETH of 155356 million. By May 3, the number had risen to ETH 19.0378 million. This is a 22.54% increase.
ETH: Balance of accumulated addresses. Source: Cryptoquant.
“ETH investors demonstrate strong beliefs about assets, projects and ecosystems. Their on-chain behavior reflects structural beliefs and clear expectations for short-term valuations in line with the broader evolution of Ethereum,” said analyst Carmelo_Alemán.
Finally, Ethereum’s upcoming Pectra upgrade, scheduled for May 7, 2025, is contributing to market optimism. The upgrade is intended to improve the ease of use and user experience of the wallet. It can increase the adoption of DAPP and long-term ETH demand.
Meanwhile, May 7th is also the date of the FOMC meeting, with FOM announces its interest rate decision. If macroeconomic news is preferred, it could amplify ETH’s short-term benefits along with other factors.
However, if the news is negative, it could complicate ETH price action in May.
