Ethereum Breaks Above a 2-Month Resistance Line, Soars 13% as ETH Bulls Target $4k

Ethereum Relief Bounce, ETH Bears in Charge below $1.85k
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Ethereum is one of the top performers in the last trading week, adding double digits and blasting past resistance levels as per the formation in the daily chart.

At spot rates, ETH is changing hands at around $3.4k, rising 12 percent in the last trading week and outperforming the greenback.

From a fundamental perspective, the surging interest in Ethereum could be attributed to the upcoming upgrade and shift to proof-of-stake in the Merger. The Merger will be a huge milestone for Ethereum–network developers have been preparing for the shift since “Homestead“.

The Race to Eth2 Merger, Billions Locked

When writing, over $36.6 billion of ETH remains locked in the official Eth2 deposit contract, earning validators with above-rate and near risk-free interest rates on their assets.

Using the proof-of-stake consensus algorithm, the Beacon chain runs in parallel with the proof-of-work mainnet.

However, in the months ahead, the proof-of-work network will be deactivated, ushering in a period of high energy efficiency.

Overall, this will play a massive role in making Ethereum environmentally conscious, a net positive for the blockchain, possibly attracting more governmental and institutional adoption.

Cautiously Optimistic

Nonetheless, Eth2 validators must allow their assets to sit dormant for months until the official shift in Phase 2 before withdrawing assets or using them in exciting protocols in DeFi.

At the same time, users should be aware of the risks associated with upgrades.

A minor glitch due to hurried upgrades implemented without a thorough audit could introduce fragilities compromising the security of the whole network.

Ethereum Technical Analysis

ethereum price analysis

The Ethereum price is trading at a three-month high when writing, breaking above the $3k and $3.3k resistance levels. Overall, buyers are in a commanding position, surging with increasing interest from traders.

In light of the recent formation, traders might find entries on dips, buying the coin above $3.3k in anticipation of another leg up towards $4k. Notably, the spring higher is with rising trading volumes—pointing to high momentum. As proof, ETH bull bars are banding along the upper BB. At the same time, the upper and middle BBs are diverging, pointing to high volatility—an opportunity for aggressive traders.

If ETH prices drop below $3.3k in a reversal pattern, it will slow down the uptrend. On the flip side, a solid close above yesterday’s high would solidify bulls’ conviction—building a foundation for $4k in days or weeks ahead.

Technical charts courtesy of Trading View

Disclaimer: Opinions expressed are not investment advice. Do your research.

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