The last two months have been a boon for Ethereum investors as compared to the worrisome price action of June and July when many believed cryptos will plummet to even lower levels. Even a cryptocurrency with a huge market cap like ETH has rallied by more than 130% since July lows. Its capability to work as a platform for decentralized applications has allowed programmers to develop their software on its ecosystem.
Pioneering the concept of smart contracts has allowed ETH to dominate the crypto space. Its globally distributed node network is less prone to hacking and allows developers to operate censorship-free smart contracts. Ethereum is the only competitor close enough to challenge the dominance of Bitcoin.
After launching the Ethereum 2.0 blockchain, they have rarely looked back. Investors are also putting their money on leading cryptocurrencies expecting the supply to eventually run out creating exponential growth. Let’s talk more about the price action and possible movement of Ethereum in the short and long term.
Ethereum Price Analysis
Ethereum has shot up like a rocket marking 23% of gains in just four days. This uptrend has come without any rise in volume, which is a huge point to be considered. Since ETH has been rising with the same volumes as before it means people are holding ETH.
Ethereum has moved out of its consolidation zone, in which it was stuck for the entire month of August. Based on our prior ETH analysis, consolidation after a rally usually prepares the coin for a further and stronger up move. At present, ETH is trading at $3950 levels, which is barely 1.2% away from the $4000 milestone. Ethereum has strong support at $2900 levels, followed by $2400. The 200 Day moving average of Ethereum also lies at $2400 levels. This support is there for the long-term price action in the months to come.
Once Ethereum price manages to scale past $4000, it will be difficult to predict a level target. Since the next obvious target would be a 5-digit number. For short-term trades, pullback or profit booking at these levels can retrace these vertical gains as $3300 would become a stronger support level for its price movement.
RSI is trading in overbought zones consistently indicating a higher buying action. The MACD indicator has also made a bullish crossover two days ago, precisely before the September 01 rally of 12%.
Ethereum has been on a steady uptrend since breaking out of its consolidation, and the best thing is there are no sudden profit bookings or sudden buying. A steady-state of up move. RSI and MACD on hourly charts also side with bulls. However, lowering volumes indicate an even bigger rally. With this strength, ETH can soon clock $5000. After every vertical green candle, there is a few hours of consolidation followed by a further up move.
According to our Ethereum predictions, buyers making entry at current levels should be cautious of getting smaller returns and shouldn’t expect a repetition of this rally. While previous holders should continue to book profits, while it rallies and re-enters during the consolidation phase.