After failing to break through early November resistance in the $1,675 area late last week, Ether (ETH), the token that powers the Ethereum blockchain, is in consolidation mode. It last moved sideways through $1,600 as traders eye upcoming macro drivers, including 4Q2022 US GDP growth data on Thursday and December core PCE inflation data on Friday.
Both data readings could affect expectations of Fed tightening this year, which could impact crypto – easing Fed tightening expectations on the back of evidence of slowing US inflation and growth has boosted crypto so far this year. In fact, despite its recent consolidation, Ethereum is still trading over 35% higher so far this year, meaning the world’s second largest cryptocurrency by market capitalization is on track for its best monthly performance since July 2022 Mr.
Where is ETH next?
Positive macro tailwinds, as well as optimism about Ethereum’s upcoming upgrade that will allow withdrawals, could support further upside. Indeed, progress towards the so-called “Shanghai” hard fork appears to be going smoothly – a core Ethereum developer just announced on Twitter that the developers have set up a new testnet to test the recent withdrawal of a staked ETH token.
Meanwhile, another possible headwind could be if ETH supply conditions remain deflationary. According to ultrasound.money, ETH’s annual inflation rate fell back into negative territory early last week for the first time since November.
A break above the $1675 resistance area could open the door for a quick rally to the next major resistance area around $1790 and then the summer 2020 highs at $2030.
Experts give their price predictions
According to algorithm-based crypto prediction website Wallet Investor, Ethereum is likely to trade just above $700 in a year, about 55% lower than current levels.
Analysts at DigitalCoinPrice are not so bearish. Their algorithm predicts the end of Ethereum in 2023 at around $3,450, an impressive over 100% increase from current levels.
Meanwhile, according to a recent survey of 55 fintech experts conducted by Finder.com, Ethereum is expected to end 2025 at $5,150 per token before eventually climbing to $11,700 in 2030. The CEO and co-founder of Osom Finance’s Anton Altement explained that he is bullish on ETH because last year’s merger turned ETH into both a deflationary and profitable asset.
He added that pessimism fueled by Fed tightening should ease in 2023, while concerns about still-locked ETH bets will also soon be eased by the upcoming upgrade of the Shanghai hard fork, expected at the end of this quarter .
Martin Fröhler, CEO of Morpher, also outlined a bullish view. According to the study, Foehler expects massive institutional demand for ETH in the coming years as a result of the positive characteristics of the cryptocurrency. These include ETH’s yield of around 5% via staking, its ecological nature after the proof-of-work merger, the fact that it is classified as a commodity, and the fact that ETH has a regulated futures contract on the CME to hedge price volatility.
Is it too late to buy Ethereum?
If the above bullish forecast is correct, it is certainly not too late. Yes, it would have been preferable if we had accumulated ETH in June 2022 when it bottomed out at $800 per token. But if you are a long-term investor who wants to hold Ethereum until it reaches above $10,000, it won’t matter much whether you bought at $800 or current levels of $1,600.
Ethereum is still down about 65% from its record highs reached in late 2021 at $4,800. So far in Ethereum’s history, buying it when it is still 65% below recent record highs has never been a winning strategy, even if investors failed to catch the bottom.
Buy Ethereum now
Alternatives to Ethereum
If you’re looking for other high-potential crypto projects alongside ETH, we’ve reviewed the top 15 cryptocurrencies for 2023 analyzed by CryptoNews Industry Talk Team.
The list is updated every week with new altcoins and ICO projects.
Disclaimer: The Industry Talk section features insights from players in the crypto industry and is not part of the editorial content of Cryptonews.com.