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Why Professional Traders Expect Ethereum Rally to $5,000

The US SEC’s shift toward approving Ethereum ETFs has sparked optimism among traders, predicting price gains for ETH. Ethereum options indicate a bullish outlook for June, with traders expecting ETH to exceed $4,000 and possibly reach $5,000. This development parallels Bitcoin’s ETF-driven growth, suggesting Ethereum may approach its all-time high by summer.




The start of trading with Ethereum ETFs seems to be only a matter of time after a fundamental decision by the US Securities and Exchange Commission (SEC). The market for Ethereum options is now signaling price gains in the summer.

For the moment, Ethereum (ETH) is the top topic among crypto traders

On Thursday, the US Securities and Exchange Commission (SEC) made it clear that it is abandoning its blocking stance with decisions on possible Ethereum ETFs.

That means that Ethereum is likely to follow the example of Bitcoin (BTC) in the foreseeable future and find its way onto the classic stock exchange floor as an ETF. This starting point makes professional traders optimistic about the price development for the number two cryptocurrency.

This can be clearly seen in the data on Ethereum options. Here, bulls have taken the lead and are betting on a rising price curve for ETH. It is interesting that they are predicting the rally for June, but are remaining cautious for the current May.

The deadlines are usually the last trading day of a month, i.e. May 31st and June 28th. Ethereum options with a volume of around $3 billion are then due. As of May 31st, puts and calls are almost balanced with a ratio of 0.82, but by June 28th, the ratio shifts to 0.55. With puts, traders secure the right to sell their Ethereum at a fixed price, while calls reserve the right to buy. A put-to-call ratio of over 1 therefore demonstrates pessimistic prospects.

Ethereum is currently trading at around $3,900. The SEC’s change of direction came as a surprise and probably caught some traders off guard. They will therefore try to limit their losses. As a result, high volatility is expected for Ethereum this week leading up to May 31st. But the situation will look different on June 28th.

Then ETH options for $4,000 and above will be clearly in the majority and calls will also be concentrated at the $5,000 mark. In other words: At least for the June 28th deadline, Ethereum options traders are certain that ETH will be trading above 4,000 and see good chances for $5,000.

Conclusion: Ethereum on the way to a new all-time high?

Analyzing the markets for Ethereum options as a basis for price forecasts is just one of many possibilities.

Standard Chartered Bank, for example, is already pricing Ethereum ETFs into its forecasts and sees ETH at $8,000 by the end of the year. It should be clear to you as an investor: Bitcoin ETFs have driven the price curve of BTC with a time delay and no Ethereum ETF has yet been finally approved and given a launch date.

Bitcoin needed about two months after the debut of its ETFs to set a new all-time high. For Ethereum, the all-time high is just under $4,900, which is at the upper end of the corridor that risk-taking professional traders with ETH options are setting by the end of June.


(Featured image by  DrawKit Illustrations via Unsplash)

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First published in BLOCK-BUILDERS.DE. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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Sharon Harris is a feminist and a part-time nomad. She reports about businesses primarily involved in tech, CBD, and crypto. She started her career as a product manager at a Silicon Valley startup but now enjoys a new life as a personal finance geek and writer. Her primary aim is to provide readers with a new perspective on the overlapping world of finance and technology.