Ethereum: $2,000 after The Merge? On the Coinmarketcap platform, the countdown has started. In just over 6 days, the transition from Proof of Work to Proof of Stake will be definitively sealed for the Ethereum blockchain. The major crypto event of the year 2022 could well have its say on the price of Ethereum. So, will ETH return to the $2,000 threshold after the merger? Let's see it all together!
6 days before The Merge!
If the process is already well underway, it could be finalized by the end of next week. This event, which many consider to be a “game changer”, has caused a lot of ink to flow for months. Because if Ethereum has long postponed this update and the sustainability of its blockchain, the time is now for the definitive merger.
In a few days, The Merge will allow the Ethereum blockchain to move from a “Proof of Work” type transaction validation protocol to a “Proof of Stake” protocol. An element that should allow the Ethereum blockchain to be more than 1,000 times less energy intensive . But this process will also improve the scalability of the blockchain and the number of transactions processed per second in addition to ultimately reducing transaction costs.
If the advance is major and recognized by all (or almost), observers are torn on the degree of inclusion of this data in the price. While it seems obvious that The Merge is somehow priced into Ethereum's price, given its outperformance against Bitcoin, some believe the market still has some surprises in store. While others rely more on the status quo.
READ MORE: Ethereum Merge Explained.
What about technical indicators?
The information returned by the technical indicators seems to argue for a bullish momentum . This is particularly the case of the stochastic oscillator which indicates that the buyers keep control of the sellers. Despite the strong correction of the last few weeks, the price of Ethereum has not broken its medium-term upward trend, visible since last June.
Nevertheless, the price of Ethereum could come up against a major resistance marked by its 50-day simple moving average (SMA). A bullish reversal above this moving average could set the tone. And to accredit all the more, the return above 2,000 dollars. The same goes for the 78.6% Fibonacci retracements near $1,800. A daily close above this threshold could give the LA to regain the $2,000.
Other concrete elements plead for a continuation of the increase. As Glassnode argues, the number of whales is increasing. Thus, if on May 10, there were 6,174 wallets with more than 1,000 ETH, they are now 6,404. An element that generally constitutes a bullish signal. Glassnode even estimates that if the accumulation continues, Ethereum could reach the $3,000 threshold.
The Merge could increase volatility around Ethereum!
If the observers sometimes tear themselves apart on the already present integration of The Merge on the price of the asset, one thing seems to have a little more consensus: the volatility around the project upstream, but also downstream of the merger.
If some feared the suspension of trade after the merger, the Coinbase platform has just announced that transactions in ETH will remain available throughout the process. The movements of the whales that move large quantities of ETH to the exchanges also accredit this hypothesis of high volatility.
As of this writing, Ethereum is priced at $1,623.45, according to data from the Coinmarketcap platform . Over the last 30 days, Ethereum has posted losses of around 5%. A level that greatly outperforms the market and in particular Bitcoin which shows a decline of 18% over the same horizon. If we focus on the last 60 days, Ethereum recorded a gain of 37% when Bitcoin posted a loss close to 10%.
The last few weeks have also played on Ethereum and Bitcoin dominance. While the mother of cryptocurrencies appears at levels more seen since 2018 , Ethereum is strengthening its rank. The ETH marketcap now accounts for more than 20% of the total crypto marketcap.
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