Ethereum has recently enjoyed a significant win, with the U.S. Securities and Exchange Commission (SEC) dropping its investigation into the cryptocurrency for allegedly selling ETH as a security. This decision, announced by Consensys on Wednesday, saw Ethereum’s price climb above the critical $3,500 mark, currently trading at $3,584, marking a 0.8% increase over the past 24 hours and a 2.2% rise over the week.
Crypto analyst Sjuul’s recent analysis of Ethereum highlights mixed signals as the cryptocurrency navigates a consolidation period. His detailed chart illustrates Ethereum’s price movements segmented into phases. The Accumulation phase, marked in yellow, signifies a stable period of gradual ETH accumulation, indicating a balance between buying and selling pressures, setting the stage for future price movements.
Sjuul’s chart also identifies a Manipulation zone, highlighted in red. This phase indicates volatile price movements and potential false breakouts aimed at misleading traders. It is a crucial period where market participants need to be cautious, as it often involves significant price fluctuations that can shake out weaker hands and create market confusion.
A pivotal element in Sjuul’s analysis is the Level to Reclaim, positioned just above the current consolidation zone. This level represents a crucial resistance point for Ethereum. According to Sjuul, overcoming this resistance could signal the beginning of a bullish trend. Once ETH surpasses this level, it is expected to enter the Expansion phase, depicted in green, leading to substantial upward price movement.
Supporting this bullish outlook, another analyst, Yoddha, has observed a slight consolidation following a morning star formation, a signal of a bullish reversal from the bottom of a downtrend. Yoddha is optimistic, stating that Ethereum is poised for significant gains and could surpass $10,000 by the end of the year, driven by strong technical indicators and market sentiment.
Ethereum MVRV Rising Faster than Bitcoin
Key metrics further underscore Ethereum’s potential. CryptoQuant CEO Ki Young Ju pointed out that Ethereum’s Market Value to Realized Value (MVRV) ratio is rising faster than Bitcoin’s, indicating a heating market. Despite this, Ju believes that the high MVRV and increased transaction volume and active addresses do not suggest overvaluation but rather a robust market poised for growth.
The comparison between Ethereum and Bitcoin over the past 30 days reveals Ethereum’s MVRV jumped 29.9% to 91.43%, while Bitcoin’s fell 10.8% to 127.41%. A high MVRV typically signals overvaluation, which might trigger a sell-off. However, Ju argues that the upcoming spot Ether ETFs, expected to start trading soon, will likely mitigate fears of overvaluation and attract investors, marking a potential ETH-only season.
Ethereum’s current price stability above $3,500, coupled with the long-term support of the 50-day and 200-day simple moving averages (SMA), indicates a favorable outlook. However, the cryptocurrency faces immediate resistance at $3,654. A breach above this level could propel ETH towards $3,750, while failure to maintain support above $3,500 could see it drop to $3,432 or lower.
Ethereum’s recent regulatory relief and strong technical indicators suggest a promising future. The cryptocurrency is well-positioned to overcome current resistance levels and achieve significant price gains, driven by strong market fundamentals and positive investor sentiment. As Ethereum continues to navigate its consolidation phase, all eyes are on its potential breakout and subsequent price expansion.
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