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Ethereum fell on Wednesday, dropping to the $1,250 level as ETH succumbs to selling near resistance around the $1,400 level. ETH continues to find resistance as it continues to look higher, testing the resistance level and bouncing back.
(January 27, 2021 8:30 PM EST)
Ethereum continues to struggle around $1,400 resistance which has caused quite a bit of contention. This is not so dissimilar from Bitcoin repeatedly finding resistance around the $11,000 - $12,000 level last summer, an arbitrary price level though caused much volatility and sideways trading. I think it's only a matter of time before ETH busts through to the upside; the 2018 ATH has already been pierced (twice) as ETH continues to hold onto a very well-defined uptrend on the daily chart, even maintaining a steady ascending channel in lieu of the recent correction/pullback.
Primary view:
The bottom is in ($900 in early Jan., - sorry, you missed it!). ETH's floor is $1,000 and we are now banging on the doors to breakout higher into a new range, about to leave the low $1,000's for a good long time (maybe forever).
Alternate view:
I'm not going to beat the same bullish ETH horse to death, so here are (some) of the cliffnotes:
- Ethereum CME futures trading launches in Feb
- Phase 0 Beacon Chain launched on time (Dec. 2020) - Over $1B ETH staked to-date
- ETH 2.0 Phase 1 estimated to launch in late 2021
- EIP-1559 expected to launch soon, reducing congestion fees
- >80%(?) of crypto projects are built on Ethereum (ERC-20)
- Exchanges are running out of ETH reserves
- Grayscale ETH Fund seeing huge demand increase
- Reddit announces partnership with the Ethereum Foundation
- Network effect of being second-largest crypto on nearly all exchanges (retail can't afford Bitcoin, but hey I can afford 1 Ethereum!)
Simple strategy: Buy the dips and earn ETH however possible. Otherwise, DCA on a weekly/biweekly basis, whatever you can afford. Historical charts and models all point to 2021 being substantially better for crypto and ETH in particular, although ETH has outperformed BTC in 2020 so really it's no surprise there.
Support: With the rising 50 Day EMA now above $900, we may have to consider $1,000 a "floor" soon. Below that, $800 is probably a golden ticket, though I'm not confident we'll get that low anymore.
Resistance: $1,400 remains immediate resistance until we get an impulsive candle breaking higher, which looks very likely possibly even this week. Then, ETH should hit $1,500 and then $2,000. EOY 2021 I think ETH could very reasonably be $3,000 - $5,000, with $2,000 being my conservative price target.