Last Resistance Before Ethereum At $5K? Expert Predicts Q4 In The Green
October 05 2021 - 1:00PM
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The bulls have taken over the crypto market with Bitcoin and
Ethereum recording gains across the board. A year ago, the price
action that preceded the end of the year took the market into new
highs. The expectations are similar, but experts are yet to find a
consensus. At the time of writing, Ethereum (ETH) trades at $3,466
with a 2.5% profit in the 24-hour chart. In his most recent report
for Bloomberg Intelligence, Senior Commodity Strategist Mike
McGlone believes the “biggest surprise” would be to not see higher
prices for Bitcoin and Ethereum. Related Reading | Bitcoin
Shakes Off Bloody September As Price Breaks $50K, Headed For New
All-Time Highs? The two main cryptocurrencies by market cap have
been experiencing short-term bearish obstacles but with long-term
bullish fundamentals. The crypto ban imposed by China is one of the
most prominent examples. McGlone expects $40,000 to become the new
critical support for Bitcoin in the coming months. Conversely,
Ethereum could move into the $2,000 to $3,000 support zone in case
of any downside risk. Both cryptocurrencies have been increasing
their price floors after May, June, and July brought in a high
amount of selling pressure into the market. Ethereum has major
price tailwinds in the non-fungible token (NFT), fintech,
stablecoins, and decentralized finances (DeFi). Thus, the analyst
believes ETH’s price is still in its early days of price discovery
moving into more appreciation. Related Reading | TA: Ethereum
Could See “Liftoff” if It’s Able to Hold One Crucial Level The
introduction of EIP-1559 has added a new bullish factor for the
Ethereum chart. According to McGlone: Demand and adoption are
rising, but our graphic depicts a notable difference from a year
ago — plunging supply. At the start of 4Q20, the 12-month rate of
change in the measure of Ethereum supply from Mosaic was closer to
5%. Now it’s on track to drop toward 2% because of a recent upgrade
Ethereum Taking Market Share From Bitcoin It is due to its use
cases that Ethereum has managed to attract major players and take
over an important market share. As seen below, the second
cryptocurrency by market cap is starting to look more of a leader.
The digitalization of money and finances, as the analyst said, will
continue to create demand for Ethereum. In the DeFi sector, the
growth has been exponential with the total value locked of these
assets reaching $100 billion versus the $20 billion recorded in
2020. On Oct. 4, the market cap of the No. 2 crypto was about 20%
of the total, vs. closer to 10% at the start of 2021. Bitcoin’s
dominance has weakened to about 40% from 70%. Mosaic and Coin Dance
data place Ethereum atop the food chain, indicative of rising
crypto values and it’s prominence as the go-to platform for smart
contracts, NFTs and decentralized finances. In that sense, the
report claims that investors without a position in the crypto
market could be making a similar mistake to missing out on the
early days of the internet.
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