Ethereum's price trajectory through 2026 depends on whether the Fusaka upgrade can strengthen its Layer 2 ecosystem enough to offset regulatory uncertainty and staking concentration risks. The network sits at a pivotal technical level around $3,120, where a breakout could trigger short liquidations and accelerate upside momentum.
What Happened: Technical Resistance
Ethereum faces resistance at $3,120, aligning with a key liquidation cluster. A confirmed move above this zone would shift focus toward $3,570, corresponding with the 38.2% Fibonacci retracement and serving as the next meaningful resistance test.
Failure to clear $3,120 leaves Ethereum vulnerable to a pullback toward $2,720. A retest of this level would suggest the market remains range-bound rather than transitioning into a sustained uptrend.
The Fusaka upgrade represents a central variable in Ethereum's 2026 trajectory, with impact measured through changes in Layer 2 transaction throughput, fee efficiency and developer engagement.
If the upgrade meaningfully improves L2 scalability and reduces friction for rollups, Ethereum could reinforce its position as the dominant execution and settlement layer, supporting long-term demand for ETH as both a utility and staking asset rather than relying solely on speculative flows.
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Why It Matters: External Risks
Regulatory uncertainty remains a key risk, particularly with the SEC's decision on Ethereum ETF-related matters expected in Q1 2026. A favorable outcome could broaden institutional access, while delays or restrictions may cap upside momentum.
Staking centralization presents another concern. Concentration among large validators and liquid staking providers raises questions about network resilience and governance, which could influence institutional perception over time.
Ethereum's long-term price outlook hinges on execution rather than narrative.
A breakout above $3,121 would strengthen the bullish case and open the path toward higher Fibonacci targets, but the Fusaka upgrade must translate into measurable growth in Layer 2 usage to support a move toward new all-time highs.
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