Ethereum Shoots Past $3,400 Amid Dencun Upgrade, ETH ETF Optimism

Ethereum (ETH) has crossed the significant threshold of $3,400, fueled by positive market sentiment and anticipation surrounding the upcoming Dencun network upgrade.

Ethereum Dencun Upgrade to Go Live on March 13th

The Ethereum Foundation announced the Dencun upgrade, scheduled for implementation on the Ethereum mainnet on March 13, 2024. This upgrade aims to introduce significant improvements to both the consensus and execution layers of the network, potentially enhancing scalability and reducing transaction fees, particularly on Layer-2 solutions.

The upgrade encompasses various Ethereum Improvement Proposals (EIPs), including EIP-4844 for shard blob transactions, which is expected to significantly reduce transaction costs. While Ethereum users are not required to update their wallets, node operators must upgrade their clients to ensure compatibility with the post-Dencun network.

Ethereum Price Soars, Profitability on the Rise

ETH has experienced a recent surge, rising over 6% in the last 24 hours and a notable 17.7% over the past week. This bullish trend has translated into significant profitability for traders and investors, with Santiment reporting an on-chain profit to loss transaction ratio of 2.3 to 1, favoring profitable transactions.

• Over 93% of the total ETH supply is currently in profit, mirroring levels last seen in August 2021, near Ethereum’s all-time high.
• Long-term holders, often referred to as “diamond hands,” appear to be profiting more than short-term traders, potentially reflecting anticipation of further price increases.

JPMorgan Identifies Key Crypto Catalysts

Investment bank JPMorgan Chase has identified three key catalysts expected to drive cryptocurrency prices in the coming months:

1. The Bitcoin halving event, scheduled for May 2024, which is historically associated with price increases due to a reduction in new coin supply.
2. The Dencun upgrade on Ethereum, anticipated to improve network scalability and user experience.
3. The potential approval of spot Ethereum ETFs by the SEC in May, which could attract further institutional investment.

Ethereum (ETH/USD) Technical Analysis

Bullish indicators:

• Price action is currently above both the 50-day and 200-day moving averages, indicating an upward trend.
• The Relative Strength Index (RSI) is around 70, suggesting the asset might be nearing overbought territory.

Potential resistance:

• The immediate resistance level lies around $3,500, followed by the psychological level of $3,600.

Support levels:

• The first support level sits around $3,300, followed by the recent low of $3,200.