Ethereum
Can Ethereum ETFs Push ETH Price Past $5,000 By Q3?
As July approaches, Ethereum ETFs, which received the partial green light from the US SEC on May 23, are close to their official launch. Many investors are wondering whether the price of Ethereum (ETH) will follow the reaction of Bitcoin (BTC) to its associated financial instruments in January.
But that answer lies in the future, which could begin in a few days. In the meantime, the on-chain analysis provides actionable insights that can predict whether the altcoin is following a likely pattern.
Altcoin investors are in a good mood
The change in registration documents is one of the factors that has delayed live trading of Ethereum spot ETFs. However, in a recent interviewSEC Chairman Gary Gensler confirmed that everything is going well.
Furthermore, a report from anonymous sources from the regulatory agency reveals that the products will launch on July 4.
Following the development, BeInCrypto has been monitoring holders’ behavior towards ETH. According to our findings, ETH holders display a strong trust in the cryptocurrency. We discovered this after examining the LTH-NUPL provided by the analytical platform Glassnode.
The metric stands for Long Term Holder-Net Unrealized Profit/Loss. It measures the behavior of holders who have owned a cryptocurrency for more than 155 days. As shown in the table below, different colors exist for different feelings.
Learn more: Ethereum ETF Explained: What It Is and How It Works
Ethereum LTH-NUPL. Source: Glass node
While red indicates capitulation, orange signifies fear. Yellow indicates optimism, while blue suggests greed. Currently, Ethereum’s LTH-NUPL is in the belief zone (green). When this happens, long-term investors are confident about an upcoming price rally.
However, ETH has seen a 12.75% decline in the last 30 days as it trades at $3,365. In situations like this, the overall sentiment should be bearish. So, while perception leans towards confidence, the highly anticipated development This seems to be the reason. If this holds until launch day, it may boost demand for ETH.
Ethereum Knocks Bitcoin Out of the Way
In the meantime, perception alone cannot move prices. Therefore, we evaluate another indicator that can affect the altcoin price, namely the ETH/BTC ratio. This ratio indicates whether Bitcoin outperforms Ethereum or the other way around. More specifically, if the ETH/BTC ratio is high, it means that ETH is outperforming Bitcoin.
However, a low ratio implies that BTC is outperforming ETH. At the time of writing, the ratio is 0.055, which is up 2.33% over the past seven days. This means that today, one ETH can buy 0.055 BTC.
If the ratio continues to increase, Bitcoin’s market dominance will decrease. Thus, Ethereum can move higher while its price can climb much higher. Considering Bitcoin’s performance, the price has increased by 56.95% in less than two months after its approval.
If ETH follows a similar move, the cryptocurrency’s value will reach $5,308 before the end of the third quarter (Q3). Now let’s look at the value of altcoin short-term potential.
ETH price prediction: its price is not taken into account
According to the daily chart, the 20 (blue) and 50 (yellow) EMAs are above the Ethereum price. EMA stands for Exponential Moving Average. It is an indicator that measures the direction of a trend over a given period.
When the EMA is below the price, it indicates that the bulls are defending it. However, the fact that the indicator is above the price lends credence to the downside. If conditions remain the same, ETH could drop to $3,278. This position also shows that ETH is not yet considered.
In simple terms, this means that the economic impact of the upcoming development has not yet been reflected in the current market price. Therefore, it can be assumed that the value still has upside potential.
However, both EMAs are about to reach the same point. If this happens, The price of ETH will move sideways, potentially consolidating between $3,355 and $3,610. However, if the 20 EMA reverses the 50 EMA (bullish crossover), the altcoin could enter the resistance at $3,866.
Learn more: Ethereum (ETH) Price Prediction 2024/2025/2030
In a very bullish scenario, ETH could replicate its performance between February and March, reaching $4,059 before the end of July.
Additionally, the value of capital inflows is a major concern for investors. According to online comments, a number of analysts are unsure whether Ethereum ETFs can generate the kind of volume that Bitcoin has achieved.
However, a previous forecasts placed inflows at $569 million monthly. If Ethereum matches this volume, a rally above the altcoin’s all-time high could occur in a short period of time.
But if the reception to the development is limited to “words without action,” the price of ETH could fall, possibly reaching another 10% drop.
Disclaimer
In accordance with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult a professional before making any financial decision. Please note that our Terms and conditions, Privacy PolicyAnd Disclaimer have been updated.