Ethereum is one of the most well-evaluated cryptocurrencies, so much so that you don’t have to be a crypto enthusiast to know how valuable it is. Ethereum is also popular since it is a cryptocurrency and digital economy that requires only an internet connection to access and use. Their goals for a “fairer financial system” are enshrined in ETHER’s code and are a major philosophy of the cryptocurrency’s creators. But with the recent decline in Ethereum price, there has been a drastic reduction in the coin’s popularity. This article looks at the prospects of Ethereum price rising again and if the crypto would eventually regain its popularity.
Ethereum Price On The Rise Again
Following an instant dip below $2,400 on Feb. 23 when Russian President Vladimir Putin ordered soldiers into Ukraine, Ethereum has bounced back and forth in subsequent weeks. Since then, it’s been up and down, but it’s been steadily rising in recent days.
According to experts, the crypto market is trying to reflect the rising volatility that comes with war. Other factors cited as contributing to the current state of crypto prices include the crypto market following the stock market, increasing widespread usage, and recent price slumps.
More crypto legislation, as well as the idea of developing government-issued digital money, has piqued the curiosity of government officials. Even before the conflict in Ukraine, Ethereum price volatility was fueled by rising inflation, the stock market’s worst month since March 2020, and persistent signs that the Federal Reserve will begin hiking rates at its next meeting in March to combat inflation. Bitcoin’s price has been on a similar downward trend recently.
All of this has contributed to its shaky start to the year, with Ethereum’s price dropping below $2,200 in January, the lowest since July 2021. Recently, the Ethereum price has fluctuated between $2,500 and $2,800.
Ethereum, the second-largest cryptocurrency by marketcapitalization, is currently down by a considerable margin from its peak. Its immediate support levels breaking and profit booking occurring on every upward rise imply a downturn in the short term. The aggregate market capitalization of ETH is now over $300 billion, yet this capital is under threat due to the currency’s ongoing fall. Even the respected 200 DMA levels are now about 40% higher than the current value of $2536, or around $3500. However, this curve is constantly falling to new lows.
With the fall in the relative strength index over the last few weeks, we see ETH face a difficult challenge to re-trend. ETH has spiraled into a tight trading range, with the potential for a negative breakout in the near term. Even the supports are put to the test regularly.
ETH trades between the positive and negative trend lines in the short term, signaling a potential breakout zone. When the RSI drops into the 40s, it signals a huge sell-off at higher prices. In the immediate term, we expect ETH to maintain a downward trend due to the planned arctic upgrade, which will be introduced in June 2022. In the long run, however, the story is very different.
Since 2020, ETH has been steadily increasing, and the current levels are close to its strong support level of $2100. The declining value should find support near the $2100 levels and continue to rise in the long run. With volumes still on track to match the highs of mid-2021, ETH has a lot of room to grow. Although there is overall profit booking, the preceding two candles show a higher downside wick, signaling buying at lower levels.
This scenario could benefit ETH investors because the cryptocurrency will reach new highs for a longer period. A profit booking level of $3600 would be ideal, while a perfect buying level of $2000 would be ideal. Investors and aficionados should establish their prejudices in the interim.
I believe Ethereum is consolidating, which might take weeks or months to finish, so there’s no need to hurry out and acquire it. Industry experts envision a picture that is comparable to that of Bitcoin. All bets are off if momentum does not fully rebound, and Ethereum does not hold the double bottom it made earlier this year. Ethereum is consolidating ahead of a new bullish run, and Ethereum’s price is likely to retest $1,700/$1,800 again. Although there’s reason to be optimistic, there’s no reason to rush out and buy now.