The price of Ethereum (ETH) has risen dramatically in recent months, hitting a peak of $4,384 due to the growing popularity of decentralized finance (DeFi). ETH is bounding higher, extending gains for a fifth straight day, supported by the demand outlook. The price is aiming to flip the $4,500 zone as support by the end of the week while ranging at the top. A ranging price pattern continues to predict that the ETH/USD pair may continue its upside run with both bulls and bears profiting from intraday trades. At the time of this post, ETH/USD is trading at $4,115 after registering an intraday low under $4,000 on a mild pullback. The market cap of ETH briefly crossed the $500b mark for the first time on May 12th according to data from CoinMarketCap. Ethereum is likely to break out further as DeFi usage and institutional demand, coupled with ETH 2.0 constrain supply drives demand for the token. It may surpass $1 trillion in market cap this year and is likely to be the world’s most valuable crypto asset by 2022 after ETH 2.0 goes Live, which should increase adoption.
Key Levels
Resistance Levels: $5,000, $4,700, $4,500
Support Levels: $4,000, $3,700, $3,500
ETH/USD Daily ChartAfter a mild pullback under $4,000 as seen on the daily, supporting the run at the upside is the bullish analysis (rising positive momentum and moving average MA 50 in bullish setup) which suggests limited correction before bulls continue the upside traction. It is particularly noteworthy that a much larger bullish reversal pattern may come into play if the ETH/USD pair reaches the $4,500 level.
The top focus among traders will be to take profit at psychological resistance above the $4,500 zone with caution on a break of these levels which could open the way for a further run and expose uncharted levels around $5,000 zones. However, fresh weakness may signal an extension of the pullback from $4,384 (May 12 high), where larger bulls stalled. If the ETH/USD pair trades below $4,000, sellers may test the $3,700 support level.
ETH/USD 4-Hour ChartAfter reversing on Monday, the ETH/USD pair has recovered. It reached an all-time high of $4,384. The pair remains above all moving averages (MA 50 & 200) on the four-hour chart. While indicators such as the relative strength index (RSI) remaining in the upside area above its midline. In addition, it has developed a higher low pattern. As a result, the pair will continue to rise as bulls aim for the next psychological zone of $4,500.
Against the US Dollar, the ETH built a good support base between $4,000 and $3,500, so the pair may begin to rise above the $4,200 level again. The pair is only bullish when it is trading above the $4,000 level; main resistance levels are at $4,400 and $4,500. Therefore, any breach of the $4,100 level is typically a reversal sign and the pair could continue retreating today as bearish traders eye 10% retracement at $3,700.
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