Ethereum bulls aim high for $3k, but here’s the kicker

  • February 17, 2024

Ethereum is flirting dangerously close to the $2,800 mark, which is a prelude to the much-anticipated $3,000 threshold. Over the last 10 days, Ethereum has seen a bullish surge, accumulating an impressive 21.5% gain. This uptick is a well-fueled rally, thanks in part to the influx of investment following the launch of a spot Bitcoin ETF in the U.S. Yet, Ether isn’t just riding Bitcoin’s coattails; it has its own set of aces up its sleeve that could very well catapult it past the $3,000 barrier—a level that has been elusive and, frankly, a bit of a heartbreaker since its last encounter in early 2022.

The Leap Towards $3,000

Ethereum’s rise to the $3,000 milestone is a well-planned move aided by numerous crucial variables. For starters, Ethereum is in a good position to solidify its place in the crypto industry by becoming the second cryptocurrency after Bitcoin to have its own spot ETF listed on US exchanges. This is no minor achievement, and if accomplished, it would set Ethereum apart from competitors such as as XRP, Solana, and Cardan, particularly in a sector plagued by legal uncertainty and SEC litigation against exchanges such as Binance and Coinbase.

Furthermore, the upcoming Dencun network upgrade scheduled for March 13 is poised to be a game-changer for Ethereum. By slashing transaction costs and expanding block space for rollups, this hard fork is expected to amplify the utility and demand for Ethereum’s decentralized applications and smart contracts. This could very well translate into a higher demand for ETH, propelling its price even further.

The Rocky Road to Sustaining Highs

However, getting to that $3,000 is not going to be easy. The past is a sobering reminder that achieving such a mark is easy compared to the formidable challenge of keeping it up. Ethereum’s previous record, particularly its 42% surge leading up to April 2022, which was followed by a sharp 46% drop, raises real concerns about the long-term viability of such price levels. This time, market conditions are somewhat different, with the ETH futures premium hovering above 15%, signaling a solid demand for leverage, as opposed to the neutral attitude recorded in early April 2022.

Moreover, the options market sheds light on professional traders’ sentiment, with the 25% delta skew metric revealing a cautious optimism among bulls. This cautious optimism is crucial, especially considering the speculative nature surrounding the approval of the Ethereum spot ETF. While the odds are currently in favor of approval, the crypto market is notorious for its volatility, and traders leveraging their bets could find themselves in hot water if the market takes an unexpected turn.

On the technical front, Ethereum’s bullish posture is unmistakable. The Relative Strength Index (RSI) is approaching overbought territory, and three bull market indicators, including the 20-week EMA, 50-week EMA, and 200-week EMA, all indicate strong bullish momentum. The $2,800 resistance level is critical; shattering this level might potentially open the floodgates to $3,000 and beyond.

Community sentiment is equally bullish, buoyed by the successful test net debut of the Dencun upgrade and the speculative anticipation of an Ethereum ETF following the Bitcoin ETF approval. The comprehensive support from both the technical indicators and the community’s enthusiasm paints a promising picture for Ethereum’s near future.

Source: https://www.cryptopolitan.com/ethereum-bulls-aim-high-for-3k-but/

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