Ethereum Approaching $2,500 Ahead of Dencun Upgrade in Q1 of 2024
Cryptocurrencies endured significant losses in 2022 which forced certain cryptos to lose around 80% of the market capitalization, with Ethereum falling from below $5,000. But, this year has been positive for digital currencies, with ETH/USD achieving higher highs, indicating that the trend has been bullish throughout this year.
Ethereum stopped crashing at the 50 SMA (yellow) on the monthly chart by the middle of 2022, which held as support until the end of last year, with the 20 SMA (gray) acting as resistance at the top. This year, buyers returned and Ethereum has been making higher highs, pushing above the 20 monthly SMA, which turned into support several months ago.
Ethereum Monthly Chart – The 20 SMA Has Turned into Support
Three bullish candlesticks after bouncing off the 20 SMA
In the last few months, the bullish momentum has been picking up pace, with three strong bullish candlesticks, as Ethereum prepares for the next upgrade. The Cancun-Deneb (Dencun) update is expected for testnet in early 2024, following the Shanghai update, although it might come as soon as January. This latest upgrade intends to increase the Ethereum network’s efficiency, scalability, and security. Ethereum’s execution layer, while the Deneb upgrade will be to the consensus layer
On Wednesday and early yesterday we saw some decent buying momentum, which sent the price to $2,445. But the upside move stopped there and Ethereum ended the day below $2,400. Now the $2,100 level, which should serve as a strong support zone, is an important level to monitor. This level has previously not only offered support but also exhibited resilience to buying pressure. Market participants are likely to keep this historical significance in mind, which could create an appealing opportunity for value-oriented investors.
On the other hand, the $2,500 barrier looms large on the upside, and a successful breach of this level might pave the way for a move toward the $3,000 mark. Ethereum has the ability to hit the $3,500 mark in the long run. However, the near term is likely to be characterized by choppy, back-and-forth price oscillations.
ETH/USD Live Chart
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