{"id":920,"date":"2021-10-04T14:16:33","date_gmt":"2021-10-04T10:46:33","guid":{"rendered":"https:\/\/blog.finnogate.com\/?p=920"},"modified":"2022-01-10T12:44:42","modified_gmt":"2022-01-10T09:14:42","slug":"3-factors-that-can-send-ethereum-price-to-100-gains-in-q4","status":"publish","type":"post","link":"https:\/\/finnogate.ir\/blog\/3-factors-that-can-send-ethereum-price-to-100-gains-in-q4\/?lang=en","title":{"rendered":"Three factors that double the price of Ethereum in Q4"},"content":{"rendered":"\n

Three factors that double the price of Ethereum in Q4<\/strong><\/p>\n\n\n\n

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Three bullish indicators converge as Ethereum\u2019s native token, Ether, climbs over 9% on Oct. 1 to cross $3,000, a psychological resistance level. Ether (ETH), has the potential to double its market valuation in the coming months, thanks to a confluence of supportive technical and fundamental indicators.<\/p>\n\n\n\n

Here are three key factors that can send Ethereum price to $ 6,000 over the next few months.<\/p>\n\n\n\n

1Ether-Bitcoin correlation against rising U.S. inflation<\/strong><\/p>\n\n\n\n

Oct. 1\u2019s crypto market boom coincided with the release of the United States Commerce Department\u2019s report on consumer spending<\/p>\n\n\n\n

The data shows that the U.S. core personal consumption expenditures price index, the Federal Reserve\u2019s preferred measure of inflation, rose by 0.3% in August and was up 3.6% year-over-year. Thus, the core inflation surged to its highest levels in 30 years<\/p>\n\n\n\n

Speculators tend to treat Bitcoin as a hedge against inflation, which explains the benchmark cryptocurrency\u2019s latest response to the higher consumer prices in the United States<\/p>\n\n\n\n

Meanwhile, Ether\u2019s 30-day average correlation with Bitcoin sits near 0.89, as per data from CryptoWatch, which resulted in ETH moving almost in lockstep with BTC<\/p>\n\n\n\n

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As a result, inflationary pressures gave crypto bulls a reason to pitch Bitcoin as an ultimate hedge, with MicroStrategy CEO Michael Saylor suggesting corporations convert their cash-based treasuries into BTC.<\/p>\n\n\n\n

2Supply squeeze<\/strong><\/p>\n\n\n\n

Ethereum went through a network hard fork upgrade on Aug. 5 that further raised the bullish outlook for Ether, owing to the classic law of supply and demand<\/p>\n\n\n\n

Dubbed the London hard fork, the upgrade introduced an improvement protocol, EIP-1559, that initiated the burning of a portion of Ethereum\u2019s network fee, called the base fee. So far, EIP-1559\u2019s activation has permanently removed 410,404 ETH (around $1.32 billion) out of active supply, as per Watch the Burn<\/p>\n\n\n\n

Ethereum is also preparing to switch its consensus mechanism from proof-of-work (PoW) to proof-of-stake (PoS). As a result, it has launched a staking pool that will allow users to earn rewards and grow their ETH holdings if they lock 32 ETH into the official PoS smart contract for a certain period<\/p>\n\n\n\n

So far, the amount of ETH deposited in the Ethereum 2.0 staking contract has surged from around 11,500 in November 2020 to 7.82 million ETH today. That said, the transition has effectively temporarily removed 7.82 million ETH from circulation<\/p>\n\n\n\n

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On the other hand, the total amount of Ether tokens held across all crypto exchanges has dropped to record lows. Data from CryptoQuant shows that exchanges now hold only 18.1 million ETH compared with 23.73 million ETH a year ago<\/p>\n\n\n\n

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The declining ETH reserves show that traders may want to hold their Ether tokens rather than sell them for other assets, as there could be a supply squeeze for investors looking to enter the Ether market, thus making ETH more valuable<\/p>\n\n\n\n

With EIP 1559 #ethereum supply will likely peak around 120 million, after which it will go down and down and down, meanwhile demand will be rising. Pretty sure that means the number will go up.<\/p>\n\n\n\n

\u2014 Lark Davis (@TheCryptoLark) September 24, 2021<\/a><\/p>\n\n\n\n

3cup and handle<\/strong><\/p>\n\n\n\n

A mix of lower supply and higher demand serves as a bullish backstop for the price of Ether. Meanwhile, more evidence for an upside breakout comes from a cup and handle pattern on Ether\u2019s longer-timeframe charts<\/p>\n\n\n\n

The cup and handle is a bullish continuation pattern, comprising a rounding bottom and a descending channel setup, as shown in the chart below. The structure\u2019s profit target is typically at a length equal to the cup\u2019s maximum height<\/p>\n\n\n\n

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Considering that the cup\u2019s resistance level is near $4,000, a breakout from there could send ETH to above $6,000, almost double its current price<\/p>\n","protected":false},"excerpt":{"rendered":"

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