Ethereum price continued its strong comeback this week as it crossed the important resistance point at $4,000. ETH has had a remarkable rebound considering that it plunged to $880 after the collapse of FTX. It has also risen in the past seven straight weeks and is now sitting at its highest point since December 2021.
Ethereum in exchanges is falling
ETH price has been in a strong bull run in the past few months as the crypto bull run has intensified. This rally continued this week after Bitcoin surged to its all-time high of over $72,000, marking a strong comeback for an asset that was trading below $1 in 2009.
Ethereum has jumped because of the rising hopes that the Securities and Exchange Commission (SEC) will approve a spot ETH ETF this year. Several companies like VanEck, Franklin Templeton, and Blackrock have filed for the asset.
An Ethereum ETF approval would have similar success as Bitcoin, which has added billions of assets in the past two months. The iShares Bitcoin Trust has over $13 billion in assets. Other Bitcoin funds are also seeing strong inflows.
An Ethereum ETF will perform well because it is the second-biggest cryptocurrency in the world after Bitcoin. It now has a market cap of over $486 billion and will likely cross the $500 billion mark soon.
Unlike Bitcoin, Ethereum investors will also be able to earn more returns in addition to the price movement. They will earn staking rewards, which are offered by Ethereum’s proof-of-stake (PoS) model.
Data by StakingRewards shows that the amount of staked Ethereum stands at over $126 billion and stakers are making an APR of 3.73%. The biggest staking providers are platforms like Lido, Rocket Pool, Stader, and Ankr.
The challenge with this is that the SEC believes that Ethereum should be regulated to ensure that investors get a real return. This means that the agency could reject these applications.
All this is happening as the volume of Ethereum in exchanges continues falling, as shown below. This means that ETF demand will happen at a time when there is scarce supplies for ETH, leading to higher prices.
Ethereum price forecast
The weekly chart shows that the ETH price has continued bouncing back in the past few weeks. It is in its seventh straight week of gains and has moved to its highest level since December 2021. The coin has remained above all moving averages.
Further, the Relative Strength Index (RSI) has moved to the extreme overbought level of 85 while the Stochastic Oscillator has jumped to 100. This is a sign that the coin has strong momentum.
Therefore, the path of the least resistance for the coin is extremely bullish, with the next target to watch being its all-time high of $4,870. This means that the coin could jump by over 20% from the current price.
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