The Ethereum rally continues and seems to be moving into FOMO levels. At press time, the second crypto by market cap has blasted through the major resistance at $4,000 and moves fast into price discovery.
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Ethereum records 4% and 14% in the daily and weekly charts, respectively. The euphoria in the market seems to be driven by the launch of a Bitcoin-linked ETF in the U.S.
ETH on an upwards trend in the daily chart. Source: ETHUSD Tradingview
The market has positively responded to this event and has allowed Ethereum and Bitcoin’s price to surge with a spike in institutional demand, as several experts have pointed out.
Unlike some predictions, the ETF event doesn’t seem to be operating as a “Buy the rumor, sell the news” or a trigger for another capitulation event.
In lower timeframes, Ethereum must hold above current levels to turn $4,000 into support and allow the rally to follow through in case of potential downside risk.
As pointed out by pseudonym analyst John Wick, Ethereum entered a “volatility squeeze shading” with a bullish trend, as indicated in the image below. The analyst added:
Squeeze shadings precede violent moves that are often the start of new trends. Green bars say probability to the upside!
Source: John Wick via Twitter
In that sense, losing the $3,000 area could signal a potential trend reversal to the downside. However, the second cryptocurrency by market cap could make a 5x profit from here.
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Ethereum ETF On The Way, Bulls With More Ammo In-Store
Analyst Justin Bennett believes the key for more upside actions relies on Bitcoin. If the benchmark crypto can continue its upwards trend uninterrupted, Ethereum could follow right into its May trend line, as the analyst claimed.
Source: Justin Bennett via Twitter
This could send Ethereum as high as $20,000 for 2022. In support of this theory, QCP Capital recorded an increase in ETH-based options with $10,000 to $50,000 strikes to be expired by March 2022 on the rise.
Related Reading | TA: Ethereum Breaking This Barrier Could Spark a Significant Surge
With the launch of the Bitcoin ETF, QCP Capital noted the following on the future of Ethereum:
As we mentioned in our previous post on ETFs, long-term attention seems to be shifting from BTC to ETH with potential ETH ETF release after BTC, coupled with ETH V2 catalyst.
Source: Skew via QCP Capital