Ethereum has seen incredible growth in the last couple of months as its price continues to follow Bitcoin, reaching a new high since 2022 but not a new all time high yet.
Most speculators are predicting that the price will go into a new all time high after the Ethereum Dencun Upgrade, the most awaited upgrade since The Merge.
Even though it seems possible looking at the current price of ETH, will it really be achievable considering all the buying volume that has been at overbought since the last couple of weeks?
ETH Goes Above $4,000!
Ethereum has successfully gone above the $4,000 mark in many exchanges bringing investors to a new high since the bear market happened.
The price increase has brought back many of Ethereum’s ecosystem back to life after being arguably dead for the last couple of months.
The price increase happened in the hype of the Dencun Upgrade, which is notably the biggest upgrade for Ethereum in the last two years after The Merge.
Also Read: What is The Ethereum Dencun Upgrade? Diving into EIP-4844
While The Merge significantly transformed Ethereum into a new blockchain by changing its consensus mechanism from Proof of Work to Proof of Stake, The Dencun Upgrade will do a different thing but will similarly impact the network.
The upgrade itself will increase the efficiency of communication between Ethereum and its layer two blockchains giving less transactions fees and higher transaction speed for Ethereum.
It is predicted that the speed of Ethereum will increase for up to 100,000 transactions per second while its fees will go down to below $0.01.
This is what made investors enthusiastic about the upgrade because the current condition of Ethereum is far worse than the predicted outcome of The Dencun Upgrade.
The upgrade itself is planned to happen today, March 13th, 2024 with the Ethereum Foundation itself already preparing a livestream on Youtube for people to watch it live.
Will it Go Down?
Even though it all seems positive, there are potential corrections ahead as some analyst predict that Ethereum will experience a “buy the rumor, sell the news” movement in the coming days.
The movement is very common in the financial market as usually the price of an asset increases before a big news and then suddenly drops after the news happened.
Currently, ETH is trying to break the resistance barrier of $4,000 and is trying to stay above it, potentially bringing it to its highest price of around $4,800.
This is what prompts many speculators to believe that the price will go up to $5,000 in the coming days, but with that there is also potential FOMO created which usually triggers a correction that is caused by bigger traders capitalizing on the FOMO.
If Ethereum fails to stay above $4,000, the price might potentially go down to Ethereum’s support zone at around $3,500 to $2,500 which is a good zone that is currently keeping Ethereum afloat since its last price surge.
Looking at the overbought condition of ETH, the price might potentially go down after the upgrade so it is good to keep in mind the original trading plan to avoid FOMO and maintain losses to a minimum in the coming days of volatility.
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