Ethereum (ETH) is finally ready to storm the $2000 barrier
Date: 2023-07-04 Author: Karina Ziganova Categories: BLOCKCHAIN
In the previous week, the price of Ethereum (ETH) recovered significantly, which paused the downward trend that had been going on since April
Currently, the price of ETH is consolidating in a horizontal range, between the levels of $1650 and $1950. Given the prevailing short-term pattern, price dynamics, and wave analysis, it is more likely that Ethereum will continue to move towards the upper end of this range and eventually make a bullish break out of it.
Ethereum is approaching resistance at $2000
As the results of the technical analysis of the weekly chart show, the picture for ETH looks bullish, mainly due to the impressive growth since June 15.
At that time, the price had just bounced off the horizontal support area at $1650. A subsequent long lower wick (green icon) confirmed the $1650 area as support and indicated that buyers were taking over.
Such wicks are considered bullish because they indicate that sellers have failed to push the price down.
Since then, the price of ETH has risen, peaking at $1960. Now the price is very close to the $2000 resistance area.
This is the most important area of resistance as it is the last one before the new yearly high. In addition, there is practically no significant horizontal resistance above it. Therefore, if the price of ETH takes this barrier, it can further accelerate growth.
Technical indicators are also bullish. The weekly Relative Strength Index (RSI), a tool that traders use to assess market conditions, supports the price rebound. RSI values above 50 and an uptrend indicate a favorable situation for the bulls, and vice versa.
When the ETH price bounced, the RSI also bounced towards the 50 line (highlighted in green circle). This signals a bullish trend. The RSI is in an uptrend, promising the same price of ETH.
ETH Forecast: Wave Analysis Promises $2000 Breakdown
The wave analysis of the shorter daily timeframe reflects a decidedly bullish outlook for Ethereum.
The most likely wave scenario assumes that the price of ETH started a five-wave upward movement (white) in November 2022. Further, the decline inside the descending parallel channel was a corrective wave two.
Subwave analysis is represented on the chart in black, and it shows a completed correction. The fact that the price has rebounded from the support level of 0.5 Fibo confirms this probability.
Thus, the rise since June 15 is part of the third wave, which is usually the sharpest of the bullish waves. A 1:1 ratio of the first and third waves would lead to an increase to $2700. This would mean an increase of 37% from current price levels. Subwave analysis (black) suggests the possibility of a short-term pullback, after which the growth rate may accelerate even more.
Despite this bullish outlook for ETH, falling below the second wave low (red line) at $1625 would mean that the trend is bearish.
In this case, the price is expected to draw to the next nearest support at $1300.
