Ethereum (ETH) climbed above $2,000 and tested resistance at $2,130 for the first since April last week amid renewed euphoria around the filing of the first Ether spot exchange-traded fund by global leading asset manager BlackRock.
Investors are also looking forward to the potential approval of Bitcoin spot ETFs by the US Securities and Exchange Commission (SEC) later this week, which could also be bullish for Ethereum and other altcoins.
However, the approval of the spot ETFs is not guaranteed since the SEC can decide to postpone its decision.
Nevertheless, investors turned their attention back to Ethereum price the moment news broke that BlackRock had made the first step toward applying for a spot ETH ETF.
Can Ethereum Price Uphold Support Above $2,000
Ether is trading at $2,010 at the time of writing on Wednesday during US business hours. Holding support above $2,000 seems critical for the continuation of the uptrend, especially with bulls having lost the support briefly after the US Consumer Price Index (CPI) data was released on Tuesday.
However, with inflation easing in the country, investors are expected to gain confidence in risk assets like Bitcoin and Ethereum. Moreover, geopolitical tensions occasioned by the Israel-Hamas war may continue to drive investors to crypto with ETH and BTC being the biggest contenders.
Meanwhile, support above $2,000 would mean that Ethereum has the momentum to keep the uptrend intact. It could also help support the bullish outlook from the Moving Average Convergence Divergence (MACD) indicator.
Ethereum price prediction daily chart | Tradingview
If Ethereum slides below $2,000, it could create instability and possibly lead to a sell-off as traders may want to protect their wallets to avoid liquidations. Investors who bought after the breakout above the seller congestion at $1,900 may want to sell, thus increasing the overhead pressure.
The presence of a double-top pattern around $2,130 could further complicate the technical situation for the bulls. Another rejection may lead to a spike in selling pressure.
For that reason, market participants are likely to be concerned about Ethereum’s decline below $2,000 which might trigger a sell-off to $1,900 and the local support at $1,800.
Traders interested in shorting ETH may want to ensure that the blue MACD line crosses below the red signal line. The momentum indicator will have to persistently drop toward the neutral area to affirm the new bearish thesis.
However, there is a very narrow chance that declines will intensify, especially with Ethereum forming double bullish crosses on the daily chart. The first pattern occurred with the 50-day Exponential Moving Average (EMA) (red) moving above the 100-day EMA (blue) followed by the second cross where the same 50-day EMA flipped above the 200-day EMA (purple).
Combined, these bull market indicators affirm the bullish outlook in the market, propping Ethereum price rally towards $3,000.
Ethereum Network Fees Hit 4-Month Highs
According to blockchain data company Santiment, the Ethereum network fees have in the recent past increased to their highest level in four months. This increase also coincided with the token’s climb above $2,000 suggesting that investors were transacting more on-chain.
💸 #Ethereum’s fees have unsurprisingly risen as $ETH rose back above $2K last week & network utility surged. Relatively, though, transactions are still cheap compared to $14 May average fee levels we saw. Watch how other ERC-20’s are impacted, as well. https://t.co/yuzXALw53z pic.twitter.com/ndw1PYeVEF
— Santiment (@santimentfeed) November 14, 2023
There is always a positive correlation between Ethereum price and the transaction fees. As the price of Ether rallies, investors tend to move more of the token on-chain, which contributes to the volatility and the subsequent uptrend.
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