Ethereum Price: Why ETH Forms an Ascending Channel
The price of Ethereum also rallied as investors believed that the worst part of this year’s crypto winter was already over. Contrary to the fears of many, there was no domino effect, crypto companies such as Voyager Digital, Celsius, and Three Arrows Capital have become insolvent. Meanwhile, the decentralized finance (DeFi) space has performed well in recent weeks.
The price of Ethereum (ETH) declined slightly on Monday as the recent spectacular rally subsided. The ETH token is currently trading at $1,523 after reaching a peak of $1,665. The current price is still about 75% above the June low, bringing the total market cap to about $185 billion.
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The upcoming Ethereum merger remains a key catalyst
The Ethereum price has recovered significantly in recent months. Even though the most important reason was the general recovery of the crypto market, news about the upgrade to ETH 2.0, which has been postponed several times, also contributed.
The so-called fusion is about the Ethereum blockchain moving from the Proof-of-Work (PoW) concept to Proof-of-Stake (PoS). That is the principle used to verify transactions and ensure the blockchain is working.
The goal of the upgrade is to make Ethereum a faster and more cost-effective platform for users and developers. It will also reduce Ethereum’s environmental footprint, as the network will no longer rely on prospectors. Instead, it will be all about staking after that.
History shows that PoS networks have better characteristics than those that use proof-of-work. There are several smart contracts platforms that use this technology, including Solana, Cardano, Hive, Avalanche, and Cronos.
Ethereum’s developers have hinted that the switch will happen soon. Analysts expect the merger to take place in September when the testing process will be completed. After the upgrade, developers will begin implementing sharding. Sharding is a technology that allows more transactions to be processed in the same amount of time by dividing blocks into smaller chunks, known as shards.
The Ethereum price also rallied as investors believed that the worst part of this year’s crypto winter was already over. Contrary to the fears of many, there was no domino effect, crypto companies such as Voyager Digital, Celsius, and Three Arrows Capital have become insolvent.
Meanwhile, the decentralized finance (DeFi) space has performed well in recent weeks. The total value of completed transactions across the industry has risen from a low of $73 billion this month to more than $84 billion.
Ethereum Price Forecast
On the chart, the Ethereum price has recovered strongly in recent weeks. This recovery gained momentum after the coin rose above the key resistance level of $1,278, above which it was unable to move in June and earlier this month.
Now the Ether price has formed an ascending channel. Today’s price is slightly above the bottom of this channel. The trading range can also be called a bullish flag pattern. Therefore, there is a probability that the coin will resume the uptrend when investors target the top of the trading range at $1,660.
(Featured image by Shutter_Speed via Pixabay)
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