Since the beginning of the month, Ethereum’s price has dropped by 5.4%, yet several indicators suggest the cryptocurrency is poised for a reversal and potential recovery to $6000. This is according to analyst Cointelegraph Yashu Gola.
Ethereum may close its first losing October since 2018. The expert attributes the weak performance to increased competition from new smart contract platforms like Solana and the market’s tepid response to spot ETH-ETFs.
Nonetheless, Ethereum remains above a crucial support level around $2400.
“This price aligns with the lower trendline of a multi-month ascending channel, which has historically preceded a sharp recovery in quotes, including a rebound of over 160% from October 2023 to March 2024,” Gola noted.
If Ethereum holds $2400, the price could reach the upper boundary of the corridor at $6000 in the coming months, the expert believes.
“Supporting the optimistic forecast, the Relative Strength Index (RSI) also bounced off a historical support zone, coinciding with the cryptocurrency testing the lower trendline,” Gola added.
Institutional Interest
According to CryptoQuant analyst Burak Kesmeci, on October 25, an unknown user withdrew approximately 543,000 ETH worth over $1.3 billion from the Coinbase exchange.
Coinbase’den 1,3 Milyar Dolarlık Ethereum Çıkışı—Kurumsal Alım İşareti Mi?
Coinbase’de son 3 ayın en büyük ikinci Ethereum çıkışı gerçekleşti: Tam 543 bin ETH, yalnızca bir saat içinde borsadan çıktı. 1,3 milyar doları aşan bir çıkıştan bahsediyoruz.
Oluşturduğum “Potential… pic.twitter.com/en5hXpDqkO
— Burak Kesmeci (@burak_kesmeci) October 25, 2024
This is the second such transaction in the last three months—August saw a one-time outflow of approximately 681,000 ETH. The expert suggests this could be a strong signal of growing institutional interest in the cryptocurrency.
Typically, asset withdrawals from centralized exchanges are associated with a shift to long-term holding strategies and bullish expectations, Gola explained.
However, Kesmeci noted that the transactions might be related to internal movements of Coinbase’s coins.
Potential Fund Shift from Major Competitors
The potential rise of Ethereum to $6000 could gain additional momentum from the “exit” of major competitors—Bitcoin and Solana, Gola suggests.
“From a technical perspective, Ether is currently trading near its historical ascending trendline support against digital gold, which, combined with its oversold RSI, could lead to a sharp price rebound in the coming months,” the expert stated.
An analyst known as Crypto Avails also noted that historically, a rebound of the ETH/BTC pair from the mentioned support line coincided with the start of an altcoin season.
ETH/BTC 1W
Dostlar biliyorsunuz ki $ETH altcoinlerin öncüsü kabul edilir. ETH’nin $BTC karşısında güçlenmesi, altcoinlerin yükselişi ile sonuçlanır. Bu nedenle ETH/BTC paritesine bir göz atacağız.
ETH/BTC paritesinde fiyat trende 5 kez dokunmuş veya yaklaşmış. Bu dokunuşların… pic.twitter.com/EaL6pns7fP
— Crypto Avails (@cryptoavails) October 27, 2024
“Do not be fooled by the fact that they are currently falling. I think we are nearing the end of the Bitcoin dominance chart. Altcoins are extremely cheap right now and will soon forget these levels,” wrote Crypto Avails.
Since June 2023, Solana has risen approximately 900% against Ethereum, Gola noted. As of October 27, the SOL/ETH pair reached a new high of 0.0710.
However, the weekly RSI for the pair jumped above 70, indicating overvaluation. In other words, Solana has risen too quickly and may face downward pressure.
“Bearish divergence in SOL/ETH, combined with falling RSI and volumes, indicates weakening buyer pressure and a likely price correction. Historically, overbought conditions have led to SOL/ETH falling to its 50-week EMA, suggesting a potential 35% pullback,” Gola believes.
In his view, the combination of these capital movements creates favorable conditions for Ethereum to rise to the target of $6000 by early 2025.
Back in Hashkey Capital, it was concluded that altseason is likely to begin after Bitcoin reaches $80,000.