Analyst: Ethereum May Be Poised to Retrace Crash, Rally Towards $300

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Over the past 24 hours, Bitcoin, Ethereum, and the rest of the cryptocurrency market have mounted a strong comeback. ETH, alone, has gained 13% during today’s trading session, nearing the $175 multi-week highs once again on the back of an influx of buying volume.

While the pump has paused, with Ether finding a foothold of support at $170 and holding there, a prominent analyst believes the second-largest cryptocurrency could soon return higher. In fact, he suggested a “full retrace” could be in store for Ethereum, which would result in a move back towards $300.

Ethereum Could Soon Move Towards $300

Following a plunge to $150 earlier this week, Ethereum has performed surprisingly well, bouncing back in force on Thursday, rallying towards the $175 highs as aforementioned.

Per a crypto trader known as HornHairs, this price action has allowed ETH’s inverse 12-hour chart to begin to resemble “a 2017 pump in the process of a full retrace,” with his chart showing that Ethereum was recently rejected by a key resistance level.

As HornHairs was referencing an inverse chart, what actually happened was ETH painted a clean bounce off the $148 support, boding well for the bullish narrative.

Should the “full retrace” take place, the cryptocurrency will trend back to the $290 highs in the coming weeks. 

Fundamental Signs Signal Upside As Well

To add to the bullish sentiment shared by HornHairs, there’s also been a convergence of positive fundamental events for Ethereum.

The first is related to Grayscale’s Q1 2020 investment report, released Thursday, Per that report, the firm brought in $503.7 million in the last quarter, despite the broad crash in the cryptocurrency market.

What’s especially interesting about this is that 99% of the funds, the inflows, went towards two of Grayscale’s vehicles: the Bitcoin Trust and the Ethereum Trust, which trade on public over-the-counter markets under GBTC and ETH, respectively. Spencer Noon, the head of crypto investments at DTC Capital, spoke to this report’s significance for ETH when he said:

“Institutional investors are buying ETH. The cat is officially out of the bag. From the latest @GrayscaleInvest report: Ethereum Trust saw $110M in Q1 inflows. This is more than all of its previous inflows combined for the past 2 years ($95.8M),” he explained.

The second is related to the usage of the chain itself. A report from Messari indicates that the daily value transfer — the total value of assets moved on the blockchain over a day — of Ethereum has begun to trace that of Bitcoin, with the two metrics converging on each other for the first time ever.

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This means that as an economic force, Ethereum is starting to rival the leading blockchain, despite it being valued at less than 15% of Bitcoin’s market capitalization.

While there is no correlation between the value transferred metric and the price of a cryptocurrency, the recent trend does bode well for Ethereum, as it signals increasing adoption and overall demand for ETH and ERC tokens.

Photo by Glenn Carstens-Peters on Unsplash

The Rundown

Source: https://bitcoinist.com/analyst-ethereum-may-be-poised-to-retrace-crash-rally-towards-300/?utm_source=rss&utm_medium=rss&utm_campaign=analyst-ethereum-may-be-poised-to-retrace-crash-rally-towards-300


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