- Ethereum looks well placed to continue its run towards $2,500
- The change to proof-of-stake is a month away, and the narrative is driving price
- However, the wider market may put an end to such optimism
Ethereum looks like it may have more gas in the tank with the merge one month away, pulling the market upwards as it goes. Having already put on 124% in the two months since its bottom in June, ETH has overcome a couple of crucial areas of resistance and may have a pathwards all the way up to $2,500 if the conditions are right with the rest of the market.
ETH Has Reversed June Losses
ETH has now reversed all its losses from the time of the Luna/Celsius catastrophe, clearing several major hurdles on the way. It now sits at a crucial area around, looking to crack a huge chunk of two resistance areas in one:
If it can manage this, this will show that ETH really means business and holders can look forward to using that momentum to tackle what will very likely prove to be the boss level – the area that separates continuity of a bear market into a new bull market:
Before we get too carried away with the potential impact of the ‘merge’ narrative however, there are several caveats to consider. Firstly, this is still a bear market and, until Bitcoin flips $42,000, it remains as such. This means that any rallies are to be sold into, not held onto.
Allied to this is the way the entire market is shaping up, not just Ethereum. For example, the total market cap is reaching a critical point:
As we can see, the total crypto market has bounced, without one red week, for the past six weeks, and a crucial level of resistance is approaching. The rebound we are currently experiencing will run out of steam soon, and the approaching area of resistance would be the perfect place for it to reject.
Finally we have to look at Bitcoin, which as we know drives the entire market. What we are seeing now is something of a repeat of early 2018, only less dramatic:
Bitcoin has already put in a lower low and a lower high on the weekly timeframe, an action that all but confirmed a bear market, and we can expect this line to act as resistance again, just as it did in 2018:
With these resistances on both the total market cap and Bitcoin approaching, it looks like Ethereum will have a fight on its hands to keep pushing on by itself, although there could still be some good short term gains to squeeze out of it in the lead up to the merge.