Ethereum is stable when writing though buyers are not out of the woods yet.
Technically, sellers remain in control within a bear breakout pattern below the psychological level at $3k.
According to trackers, the coin is down three percent in the past trading week, trailing the USDT and BTC. Overall, the slowdown of the past few days could be a net positive for the project in the immediate term.
The BAYC Land NFT Sale Congested Ethereum
Even though Ethereum remains one of the most actively developed crypto projects reading from GitHub commits, developers are yet to crack scaling.
Months after EIP-1559’s activation, billions of ETH have thus far been burnt. Moreover, the fee auction system changed for Base Fee and a tip for miners should one need priority processing.
However, the spike in Gas fees to over $190 on May 1 was enough evidence to indicate how delicate scaling is in the world’s first smart contracting platform.
Although Yuga Labs—the creators of Bored Ape Yacht Club (BAYC)—were accused of not optimizing their smart contracts in light of their Land mint, block space demand in Ethereum is at record levels.
As noted, the anticipation ahead of the mint and users “aping” on the launch date congested Ethereum, forcing Gas fees to unreasonably high levels.
Network users prefer the Mainnet over Layer-2
Considering the scaling challenge, Ethereum users are looking forward to the Merger.
Eventually, this would lay the ground for on-chain scaling.
Thus far, most users prefer layer-1 over layer-2, heaping more pressure on Ethereum.
Ethereum Price Analysis
Ethereum is stable at spot rates with hints of strength, reading from the candlestick arrangement in the daily cart. Notably, ETH has support at $2.7k—a crucial support level flashing with the 78.6 percent Fibonacci retracement level of the March trade range.
There are signals that ETH bulls may surge higher. However, buyers must clear $3k and reverse April 26 losses for a clear trend definition. In that case, ETH may expand towards $3.5k in short to medium term.
Conversely, a high volume thrust below $2.7k with expanding volumes may accelerate the fall to April 2022 lows of around $2.4k. This formation will be a bear confirmation, setting the pace for a possible move to bear territory and registering new 2022 lows.
Technical charts courtesy of Trading View
Disclaimer: Opinions expressed are not investment advice. Do your research.
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