Ethereum technical analysis shows that the blockchain native’s token ETH expects to reach $750 in the fourth quarter of 2020 as it holds above a key technical support level.
The ETH/USD exchange rate has attempted to breach a short-term ascending trendline for the tenth time since November 26. But bulls held up near the supportive line, raising the pair’s potential to log a rebound in the coming hourly sessions.
Ethereum technical analysis shows that each of the Ethereum token’s rebound from the support trendline has exhausted near a resistance level of $621. Both the trendlines give the impression of an Ascending Triangle structure, a technical pattern that traders consider bullish.
Ascending Triangles appear in the midst of an ongoing trend. They behave as a stopover range, an area wherein the asset consolidates for a while before continuing in the direction of its previous trend. Users develop their setups accordingly.
A $750 Ethereum
Ethereum’s ETH token has formed a similar structure, confirmed by a horizontal resistance trendline accompanied by an increasing one. It now trades within the structure’s range, only to a breakout later to the upside. It was rallying upward before it formed the consolidation pattern.
Josh Rager, the co-founder of Blockroots.com, said that ETH/USD’s consolidation inside the Ascending Triangle pattern raises its possibility to form a higher high. He stated that the next leg upward would be at least above $700.
“Ethereum is just grinding up slowly over the past month,” he explained. “If price can hold this trend and make its way back up to retest $610+ — I would expect the next move to be a higher-high With a push to over $700.”
The consequential upside target for Ethereum is approximately $762. The Ascending Triangle breakouts typically shoots the asset upward by as much as the pattern’s maximum height.
Ethereum’s breakaway from proof-of-work to become a proof-of-stake platform, is now live with the launch of Beacon Chain. The community has shown its support for the milestone upgrade by locking over $600 million worth of ETH in its core smart contract.
That has effectively removed at least a million Ethereum tokens out of active supply. Meanwhile, the token’s demand expects to shoot upward as more speculators join the Ethereum 2.0 bandwagon. Even Grayscale Investments admitted that they are witnessing a notable rise in “Ethereum only” investors, signifying the cryptocurrency’s reach the institutional circles.
“Over the course of 2020 we are seeing a new group of investors who are Ethereum first and in some cases Ethereum only,” said Grayscale’s managing director Michael Sonnenshein. “There’s a growing conviction around Ethereum as an asset class.”
Tapas Paul, the lead developer of YFDAI Finance — a yield farming platform, noted that Ethereum 2.0’s ability to make its blockchain cheaper would ensure sustainable demand for ETH.
“I see ETH 2.0 and the switch to POS as a critical milestone on Ethereum’s road to maturity,” he told NewsBTC via email. “It will offer greater revenue-generating capabilities to a much wider set of users, which will lead to mass adoption.This was a prime consideration for YFDAI when we made the decision to build on Ethereum.”
So it appears, more projects could join.