Will Ethereum hit 3k this week?

06/12/2021

ETH fell beneath an ascending triangle pattern tracking over the past fortnight after dropping to $2600 on Monday. It fell beneath the lower boundary and continued until support was established around the $2500 level. The coin did spike as low as $2330 during the week but is now attempting to maintain itself above the newly formed rising trend line, which might start making a new lower boundary for the triangle.

Yesterday, ETH did rebound from this rising trend line but was unable to overcome resistance at $2600. It has since dropped back beneath this resistance today and is trading near $2560.

Key Support Levels: $2470, $2330, $2200.
Key Resistance Levels: $2700, $2890, $3000.

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ETH-Short Term Price Prediction

Looking ahead, if the bears push beneath the rising trend line, the first support lies at $2470 (.382 Fib). This is followed by $2330 (.5 Fib), $2200 (.618 Fib), and $2036 (Feb 2021 highs).

On the other side, the first strong resistance lies at $2700. This is followed by $2890 (bearish .382 Fib), $3000, and $3135 (bearish .5 Fib).

The daily RSI made a new lower low in June beneath the midline, indicating that the bearish momentum is starting to increase again. If the RSI drops beneath the 40 level, we can expect the increased bearish momentum to drive ETH back to $2200 at the very least.

Ethereum Options ‘Looking Good’

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ETH options Open interest and ETH options trade volume were relatively high compared to the past two weeks. At the same time, ETH’s rally is influencing that of altcoins. DeFi projects and L2 scaling solutions are rallying. There is increased investment inflow in altcoins since Bitcoin’s dominance remains at 41% level.

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There are large exchange deposits being made, flooding exchanges with smaller altcoins. This is increasing the liquidity for these altcoins. Contrastingly with an increase in the volume of exchange deposits, the same may lead to a further drop in Ethereum price. In the event that ETH % balance on exchanges increases, a drop in price, to the $2000 level can be expected.

However, the dropping social volume and social media mentions along with on-chain metrics signaled a bullish price narrative for ETH. The price is more likely to cross the psychologically important level of $3000 before rallying higher, to the $3500 level. Besides, large transactions on the network are up over 7%, which further supports the bullish narrative and the rally to $3000 before the weekend.

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