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Ethereum surges 14% in two weeks, breaks key psychological barrier

Ethereum

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TL;DR

  • Ethereum’s value jumped 14% in two weeks, breaking $2,600 and potentially reaching $3,000.
  • High trading volume and bullish indicators like MACD and RSI are boosting Ethereum’s price.
  • Caution is advised in the volatile cryptocurrency market, despite Ethereum’s challenge to Bitcoin’s dominance.

Ethereum, the world’s second-largest cryptocurrency, has recently experienced a remarkable surge in value, outshining Bitcoin with a 14% price increase in just two weeks. This surge has taken Ethereum above a crucial psychological barrier, surpassing $2,600 for the first time since May 2022. 

The breach of this level has triggered a cascade of technical buy signals and reinforced an already bullish sentiment among investors, paving the way for Ethereum’s potential ascent to the coveted $3,000 mark.

Strong fundamentals and technical signals

Ethereum’s recent price surge is not just a random occurrence; it is underpinned by strong fundamentals and reinforced by various technical indicators. Here’s a closer look at the factors contributing to Ethereum’s impressive performance:

Volume Spike: As Ethereum crossed the $2,600 threshold, trading volume surged by 42%. This surge in volume suggests strong buying pressure and a high level of investor confidence in Ethereum’s prospects.

Moving Average Convergence Divergence (MACD): The MACD, a momentum indicator widely used in technical analysis, recently flashed a bullish crossover on the daily chart. This development further solidifies the upward momentum of Ethereum’s price.

Relative Strength Index (RSI): The RSI, which measures price momentum relative to recent price history, climbed above 60, entering the “overbought” zone. While this indicates strong buying enthusiasm, it also suggests the potential for a short-term correction in the price.

Robust fundamentals supporting Ethereum’s surge

Ethereum’s impressive price performance is not solely reliant on technical indicators; its fundamentals also play a crucial role. Several factors contribute to the strength of Ethereum’s fundamentals:

Staking Rewards: Unlike Bitcoin, Ethereum offers a 4.3% annual staking reward, attracting yield-hungry investors. Staking reduces the circulating supply of Ethereum, applying upward pressure on its price.

Deflationary Supply: Approximately 24% of all Ethereum is locked in staking contracts, effectively reducing the circulating supply. This scarcity of available Ethereum tokens can contribute to higher prices.

ETF Hopes: The anticipation of an Ethereum Exchange-Traded Fund (ETF) has been growing, with BlackRock CEO Larry Fink expressing support for such a development. Regulatory approval of an Ethereum ETF could unlock a new wave of institutional investment, further fueling price appreciation.

Historical data and the road to $3,000

While reaching $3,000 may appear ambitious, historical data indicates it is a feasible milestone for Ethereum. In May 2021, Ethereum reached an all-time high of $4,890, showcasing its potential for explosive growth. 

Given the current market conditions, including strong fundamentals and bullish sentiment, Ethereum’s trajectory could lead it toward the coveted $3,000 mark or even surpass it.

Caution in a volatile market

Despite the optimism surrounding Ethereum’s recent performance, it is essential to exercise caution when investing in cryptocurrencies. The cryptocurrency market is renowned for its volatility; price pullbacks are always possible. Investors must carefully assess their risk tolerance and conduct thorough research before making investment decisions.

Ethereum’s ascendance

Recently, Ethereum has been steadily asserting itself as a dominant force in the digital currency landscape. With robust fundamentals, a strong technical momentum, and the prospect of an ETF, Ethereum is positioned to challenge Bitcoin’s historical dominance. 

The breach of the $2,600 barrier may be just the beginning of a journey toward even greater heights, and global investors are watching this digital currency with eager anticipation.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Benson Mawira

Benson is a blockchain reporter who has delved into industry news, on-chain analysis, non-fungible tokens (NFTs), Artificial Intelligence (AI), etc.His area of expertise is the cryptocurrency markets, fundamental and technical analysis.With his insightful coverage of everything in Financial Technologies, Benson has garnered a global readership.

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