ETH/USD Technical Analysis
About Ethereum (ETH)
Ethereum (ETH) is the second most popularly traded cryptocurrency by market capitalization. It offers plenty of opportunities for crypto traders looking to try earning profits, as its value has grown exponentially over the years since its launch back in 2015. Ether or ETH is essentially the token transacted on the Ethereum network - a decentralized, open source software development platform with the power to enforce smart contracts. ETH is most commonly traded against the USD and its value is also priced in the US dollar - the most commonly traded currency in the forex market.
Like BTC, ETH is also a digital currency traded on online exchanges worldwide and can be stored in users' wallets. Where it differs from BTC is in the range of applications it offers. While Bitcoin can be used solely as an alternative payment option, Ethereum is essentially a decentralized payment network that offers several applications, powered by the currency Ether.
Ethereum was launched in 2015 as an open-source, blockchain-powered, decentralized platform that supports its own cryptocurrency - Ether. Unlike Bitcoin, the Ethereum platform allows developers to build their own Smart Contracts and Distributed Applications or DApps that have several use cases beyond digital currencies.
The Ethereum network is considered as a blockchain-based programming language that lets developers build and publish numerous ways to digitize transactions of even real-world assets and not just cryptocurrencies. The decentralized nature of the network allows operations to continue without the need for any downtime, offers greater protection against fraud or the need for a third-party intervention during transactions.
Ethereum is faster to process than Bitcoin - taking around 15 seconds while BTC takes close to 10 minutes. As a result of the lower transaction time, there are more ETH tokens in circulation than there are BTC tokens - one possible reason why the ETH price is considerably lower than that of BTC.Ethereum Price Prediction
By market cap, ETH is the second-largest cryptocurrency after Bitcoin and its concept was first introduced by Vitalik Buterin, a developer, in 2013. He was one of the main drivers who expanded the cryptocurrency space and the underlying blockchain technology towards more use cases beyond being a mere digital currency like Bitcoin.
ETH's blockchain process and applications were developed keeping in mind the inefficiencies of Bitcoin, and with a greater focus on decentralization. The "decentralized applications'' or DApps feature of Ethereum permits its use as far more than a digital currency, and for trading all kinds of financial assets, including stocks, property, art and more, making it a lucrative way for startup companies to raise funds using Initial Coin Offerings (ICOs).
A major upgrade to Ethereum in the form of Ethereum 2.0 is currently underway and promises higher transaction throughput on the network, from 15 transactions per second to handling tens of thousands of transactions per second. ETH 2.0 offers far greater security from attackers through the power of common consensus proof of stake blockchain. Phase 0 of ETH 2.0 was launched in December 2020, while work on Phase 1 and Phase 2 are ongoing, at the time of writing.Ethereum Price Chart History
ETH Price Factors
While the Ethereum price does not experience much volatility due to macroeconomic or geopolitical factors, there are several drivers that can cause fluctuations in the Ethereum rate, including
Although Ether does not have a fixed, limited quantity like its more popular counterpart Bitcoin, units of ETH could get added or lost over a period of time that can affect its supply and cause fluctuations in the Ethereum price.
As ETH and cryptocurrencies overall gain greater acceptance, ETH price could strengthen, bolstered by hopes for mainstream acceptance which could generate greater interest and higher trading volumes. As more independent investors jump in, the interest in trading it will soar and drive Ethereum rate higher.
As more innovative use cases for Ethereum and Ether get discovered, the greater the attention this cryptocurrency would be able to generate, and the higher its value could go. With more technological innovations, ETH could become more acceptable as a method of payment , and turn more attractive than conventional payment systems, increasing interest in trading Ethereum and driving the ETH rate higher as a result.
A key factor that can positively influence the acceptance of ETH is the regulation of the cryptocurrency market by governments. So far, in most parts of the world, cryptocurrencies have failed to get recognized as a legitimate payment instrument, keeping larger investors and financial institutions away from them. Regulation by governments and financial authorities can help bring ETH into the mainstream and therefore, offer it the legitimacy that can attract more traders and investors towards it. This, in turn, can support a rise in Ethereum rate in the future.
News in the media
As with any new technology, coverage in the media has an important role to play in influencing the price action in the ETH chart. A lack of awareness about how cryptocurrencies work by many traders and investors cause media coverage to have a greater influence on this cryptocurrency pair. Negative coverage can scare away investors, causing the Ethereum rate to crash, while positive reports in the media, e.g. greater interest by institutional investors, government regulation, new and promising innovations, etc. will cause investors to flock towards this cryptocurrency and drive the ETH price higher.
As a relatively new concept, the price action on the ETH chart sees maximum volatility on the release of news related to its development. A good way to get started with trading Ethereum is to depend on an established brokerage that has experience with trading cryptocurrencies and has had a good track record over the past few years.
It is recommended to avoid trading Ethereum with too much leverage, owing to its highly volatile and unpredictable nature. A good strategy that you can use when trading ETH is 'buy and hold', in addition to 'buying dips'. However, if you use only the 'buying dips' strategy, you may miss out on several promising and lucrative opportunities this pair has to offer, if you are only tracking its movement on the Ethereum chart’s daily timeframe.
Trading Ethereum (ETH) successfully also requires you to develop a sound knowledge of the cryptocurrency market. As a constantly evolving and innovating space, it is imperative that you keep yourself updated about all the latest developments taking place, which you can then leverage while placing more effective trade ideas. Consider signing up for a course or referring to online guides to gain a basic understanding of how to analyse the ETH chart and then follow reliable news publications in this space to know of all the latest market moving news that can impact the ETH rate in a positive manner.
Owing to its extremely volatile nature, it is recommended that you keep a close watch on the Ethereum chart on a frequent basis to make the most of any sudden moves. This works especially well in case you want to give the ‘buying the dips’ strategy a try.Best ETH BrokersETH News
ETH/USD - FAQs
Launched in 2015, Ethereum is a decentralized, open-source software platform powered by blockchain technology created with the main purpose to support transactions of the second most popular cryptocurrency worldwide - ether. Unlike the Bitcoin blockchain, Ethereum offers more use cases as it supports Smart Contracts and the creation of Distributed Apps (DApps) that can be used to digitize and transact real world assets and empower digital transformation in the financial sector.
Find a reliable exchange that supports the trading of Ethereum and create your account on it. Convert your trading capital into ETH and use it to trade against other cryptocurrencies and fiat currencies. Unlike conventional financial markets that operate five days a week, the crypto market operates 24X7, so you can enter into trades anytime of the week, from anywhere in the world.
As a digital currency, it is not possible to see Ethereum in a tangible form unlike fiat currencies. However, your Ethereum can be stored in a wallet - a software that lets you store your cryptocurrencies in a virtual, secure manner. Digital wallets have public addresses that you can share with people when you want to receive funds from them. These wallets are secured using a 'private key', essentially a password you need to use whenever you make any transaction or access your Ethereum funds within the wallet.
Even though Ethereum is not considered legal tender, ETH tokens are accepted as a form of payment on e-commerce platforms built on Shopify and WooCommerce, purchase online travel services, pay for website hosting services, and even for online shopping across some retailers, buy video games online, and even for online betting and gambling.
Some countries around the world have banned the buying and selling of cryptocurrencies, including Ethereum. While most countries have not yet regulated the crypto space, in some countries, owning and conducting transactions in Ethereum (ETH) can be considered illegal. Countries that banned Ethereum include Afghanistan, Pakistan, Bolivia, Vietnam, Bangladesh, Saudi Arabia and Algeria, while countries like China, India, Indonesia, Morocco, Nepal and Zambia have restricted its use as a payment method.
Cryptocurrencies including Ethereum are not regulated by authorities in the UK. However, the Financial Conduct Authority (FCA) does insist that cryptocurrencies adhere to regulations concerning anti-money laundering (AML).
Like the overall crypto market, trading Ethereum can be a risky proposition owing to sudden and unexpected bouts of volatility that can send prices soaring up or even crashing down. In addition, the lack of regulation in most parts of the world makes holding and trading Ethereum riskier than other conventional trading instruments.