Highlights:
- Ethereum is pushing toward $2721.2 after rallying through $2505.9 resistance
- A rally to $3000 could follow if the $2721.2 resistance gives way
- The growing consensus that Ethereum has bottomed out could push the price to $3k
Ethereum is one of the top trending cryptocurrencies on social media today. This is driven by Ethereum’s peculiar price dynamics at the moment. While Bitcoin is on its way to hit its recent all-time highs, Ethereum still sits quite below its 2021 high of $4800, trading at around $2500.
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However, the larger trend seems to be coalescing into a view that Ethereum may have bottomed out after a lengthy period of lagging the market. This could mean a price rebound is coming soon.
Ethereum’s Price Action Suggests a Potential Breakout
At the time of going to the press, Ethereum prices were about $2619.88, which is an increase of 4.29% for that day. This spike comes after bears were rejected again from the $2461.7 support region on October 25, generating strong bullish momentum.
Ever since, Ethereum has gone ahead to break the $2505.9 resistance zone, and market players are eying the $2721.2 resistance zone. Should Ethereum successfully continue with its rally past this level, analysts believe that it may very well touch $3000, or even higher, in the immediate future.
Nonetheless, there is always a scenario where Ethereum could fail at the $2721.2 resistance. In such a case, Ethereum may consolidate between the $2721.2 resistance to $2505.9 support. On the other hand, if bears take control and push Ethereum through the $2505.9 support, then it could retest the $2461.7 support level. While all these scenarios are possible, the general view appears to be that Ethereum could be headed for a rally to $3000.
Skepticism Could Signal a Bullish Reversal
For starters, there is an increasing perception among many analysts that Ethereum is grossly undervalued at its present price. One key indicator is the strong bearish sentiment around Ethereum. Many investors continue to express reservations about the protocol, especially on social media such as X.
For example, Altbender, a crypto savvy trader, indicated today that Ethereum is the most incorrectly priced asset in the market. He received replies to his post that were filled with skepticism and doubt: “ETH is simply a worthless shitcoin”, “Market is always right and it’s saying ETH is not worth the money.”
Unpopular opinion but $ETH is currently the most mispriced asset.
Bitcoin is 6% from highs
Ethereum is 60% pic.twitter.com/DmPwKhU9GT
— altbender (@altbender0x) October 28, 2024
Broadly, this feeling is reflected in wider sentiment trackers. According to CoinMarketCap sentiment tool, 60% of investors currently hold a bearish view on Ethereum. Interestingly, most investors are optimistic for the majority of the other top 100 cryptocurrencies. This degree of skepticism may well mean that Ethereum is about to undergo a positive price reversal. Such skepticism has, in the past, served as a contrarian indicator in crypto markets.
Ethereum’s Technical Upgrades Could Fuel Growth
Apart from the price movement, there are also improvements in the functionality of Ethereum which may add to the bullish momentum. In recent weeks, Vitalik Buterin has been posting about Ethereum future development scenarios. Today, he has posted about “The Splurge”, the latest step in their vision.
“The Splurge” encompasses several significant technological improvements like enhancement of EVM (Ethereum Virtual Machine) implementation, improvements in the economics of transaction fee, and the addition of sophistication in cryptographic functions.
Among the noteworthy changes in this stage is the roll-out of the EVM Object Format (EOF). These will help streamline the usage of Ethereum smart contracts and orient them on upgrades in the future. These technical upgrades could help Ethereum maintain its position as a leader in the smart contract space amid rising competition.
Account Abstraction – A New Paradigm for Security and Usability
In addition to the layer 2 solutions, Buterin also commented on account abstraction. He touched on how account abstraction is expected to increase the security and ease of use of Ethereum wallets.
For instance, through the inclusion of account abstraction into EIP Protocol, it is possible for Ethereum users to set up safer accounts that can be enabled with multi-signature wallets and gas fees paid using different tokens. Such advancements not only increase the security of the Ethereum infrastructure but also enhances its usability to the general populace.
Ethereum’s Competitive Edge in the Layer 1 Battle
Such upgrades are crucial as Ethereum continues to compete with emerging Layer 1 blockchains, including Solana and SUI. With the large community of Ethereum developers, together with the ongoing enhancement of the Ethereum protocol, the odds of Ethereum having bottomed out are quite high.
Conclusion – Ethereum Price Ready for a Major Breakout
While Ethereum’s current price of $2,619.88 may seem low compared to its all-time high, the growing bullish sentiment is encouraging. Combined with continuous protocol upgrades, this suggests it could be gearing up for a significant rally. A rally to prices above $3000 could be on the horizon for Ether.
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