Ethereum looks like it has recovered some of its losses after the May market crash. ETH has been seeing some resistance since the massive decrease, and this could possibly set up a breakout.
Ethereum Price Prediction: Breakout Soon?
The cryptocurrency market is seeing a short term declining trend with its prices, and the second-largest cryptocurrency in the world is not granted immunity.
However, experts like Sheldon McIntyre, CMT for FX Street, expressed belief the resistance is a lead-up to a possible return to stability.
First, Ethereum needs to be able to overcome the support "levels" it holds, kind of like platforms to jump off of.
Support zones are prices where buyers are concentrated and resistance zones are where sellers are concentrated. This push and pull of prices in these zones then allow for a "break" and where the old resistance zone lies, it becomes the new support zone for the next jump in price.
So prices are expected to rise a little higher until it is able to shake off the low prices it has been experiencing for the couple of week.
$ETH D1 - I fail to see any bullish scenario here, at best I’m hoping for a double fib bottom after dumps possibly coming into the weekend. Buyer volume really needs to kick in to stay above 2k$ #Bitcoin #Ethereum pic.twitter.com/ftJ5zDrcnS
— IceBear 0x (@IceBearCT) June 11, 2021
Right now, experts are suggesting Ethereum is following an ascending triangle pattern, where a horizontal line follows over the peaks of the prices since the dip. Then an inclining line follows along where the lowest dips of the prices hit.
And it looks like a setup for an Ethereum price breakout, Sarah Tran, also from FXStreet, said. Almost 50 percent of its losses have been reclaimed since the deep plunge under $2,000 on May 23, and speculations suggest a hike back in prices.
Since the pattern suggest it is ascending, based on technicalities and historical analysis, a breakout is to be expected.
By charting these lines, the measured move of a potential breakout for Ethereum is 30 percent, reaching $3,810 in value.
For added technical analysis, the cryptocurrency's price point coincides with the 78.6 percent Fibonacci extension level, adding credence to the prediction of hiking prices.
What Price Hike Means for Ethereum Investors
This 50 twelve-hour moving average is looking to be a critical resistance for ETH and a break above this level could push investors' interest and start a potential rally. Tran noted that failure to sustain above this price point could shift Ethereum price action to continue trading sideways with no substantial, realizable profit.
Tran suggestws ETH bulls to wait for an escape above the horizontal trend line at $2,936, and a spike in volume before a rally to the upside can be confirmed.
Do note that the 200 twelve-hour moving average level is currenlty acting as critical support for the cryptocurrency, correlating with the ascending trend line that forms the triangle.
A break below this line of defense, Tran said, could cause Ethereum to plunge back below $2,000, hitting well below $1,732.
Ethereum Value Outlook
Juan Villaverde of Weiss Ratings talked to MarketWatch about the cryptocurrency and how it fairs with Bitcoin. Villaverde said Ethereum and Bitcoin complement one another and do not compete.
He likens the value of both cryptocurrencies to that of gold and oil.
Gold is a safe store of value where as oil is a commodity, with its applications to everyday life incredibly diverse. And the same can be said for Bitcoin and Ethereum.
Bitcoin simply needs a robust security to guarantee user funds will not be hacked, but it is stable enough as a cryptocurrency to not do much else, viable as an investment.
Ethereum, Villaverde added, is "gas" for the digital economy. Not only does it need to be secure, but also "cheap, fast, and easy to use."
A rise in Bitcoin prices means good investments, but a too steep of a rise in Ethereum prices could fundamentally hinder it from its use as gas for the digital economy.
"Both are highly valuable and necessary to expand crypto's influence in the world," Villaverde added.
Bitcoin has recently wrapped 1.3 percent of its supply onto Ethereum's blockchain, according to The Block. Wrapped bitcoin (WBTC) accounts for 80 percent of the tokens wrapped onto Ethereum.
