Ethereum Price Forecast – Why ETH Could Hit $3000 Soon

Highlights:

• Ethereum is trading above the $2218.1 support as the price rebounds
• Sustained momentum off support could push Ethereum to $3032.9
• Pricing-in of macro risks likely to drive rebound 

Ethereum (ETH) is on a rebound today, after a strong selloff for the last 7 days. When writing, Ethereum was trading at $2320.51, up by 4.36% in the day. However, Ethereum’s intraday volumes have dropped by 28.56% to stand at $37.04 billion. This drop in volumes on a day that the price is on a rebound could be a bullish signal. It could mean that even as the price of Ethereum shows some recovery, the average holder is not looking to sell. This points to expectations that the price could be headed much higher in the future. 

However, the volume decline could also mean that new investors are not yet buying Ethereum in strong numbers. They could be waiting on the sidelines for the price to show more sustained growth before investing. This is quite expected given the strong selling pressure that has weighed on the markets recently.

While the intraday price action is not big enough to signal a change of direction, it hints that the underlying perception is changing. This is informed by several factors that hint at the end of the bear run and a possible reversal for Ethereum and other major cryptocurrencies. 

Macro Factors Driving Negative Ethereum Sentiment Now Priced In

One of these factors is the fact that most of the issues that have been weighing Ethereum down have been priced in. A big contributor to the recent Ethereum selloff was the uncertainty around who President Trump would nominate as the next Federal Reserve Chairman.

The selloff then worsened when President Trump settled on Kevin Warsh, a person who has historically called for higher interest rates and a small Federal Reserve balance sheet. Now that all this information is known and Ethereum has already dropped over 20% in 7-days, the odds are high that buyers could start coming back in. That’s because with the news already priced in, investors can now focus more on Ethereum core fundamentals.

Another issue that has been weighing down on Ethereum and other cryptocurrencies is Greenland. For most of January, there was a lot of fear that President Trump could go for a forceful takeover of Greenland. However, the President made it clear in Davos that he would not take this approach.

Again, this is a macro issue that is now factored in and leaves investors to focus on Ethereum’s fundamentals as the key driver to buying and selling decisions. With prices already highly subdued relative to the last all-time highs, the odds for buyers taking control are quite high. That’s because, from a fundamentals perspective, Ethereum is trading at a discount.

Surge in ETH Staking Likely to Drive Rebound

For context, institutional adoption of Ethereum staking continues to rise. On-chain data shows that staked Ethereum is currently at an all-time high. This is a big deal as the more Ethereum is staked, the less is available for trading. The result is that the price could go up significantly over time as the demand rises. A lot of innovation is also happening within the Ethereum network, all of which is driving up demand for Ether long term.

Technical Analysis – ETH Oscillating Above Intraday Support

After a price correction for the better part of the day, Ethereum found strong support at $2218.1. If bulls sustain momentum above this resistance, a rebound to $3032.9 could follow.

On the other hand, if bears take control and push Ethereum through the $2218.1 support, a drop to prices below $2000 could follow. Of these scenarios, a rebound to $3032.9 is more likely. That’s because most of the factors that were weighing Ethereum down have been priced in. As such, buyers are likely to start coming back now that the price is trading at a discount.