20 November, 2022

Ethereum Price Prediction – ETH Bounces 12% From Recent Lows, How High Can it

20 November, 2022
The ethereum price has risen to $1,216.65, marking a 12% increase from lows recorded on Thursday, when the FTX collapse caused a major market selloff. Its current price also represents a 2% rise in the past 24 hours, although the second-biggest cryptocurrency has fallen by 20% in the last 14 days as its ongoing upgrades struggle to counteract ongoing pessimism.

Despite the negativity of the past few months, ETH holders have plenty of reason to be optimistic. Ethereum remains the biggest layer-one blockchain in terms of total value locked in, while the positive effects of its shift to proof-of-stake have only really just begun to make themselves felt, with ETH recently becoming deflationary.

Ethereum Price Prediction – ETH Bounces 12% From Recent Lows, How High Can it Go?

ETH’s indicators remain indecisive. Its relative strength index (purple) has risen to 40 in the past few days, up from just below 30, yet it has hovered around this level for the past week, so it’s hard to say where it could go.

ETH’s 30-day moving average (red) also remains below its 200-day average (blue), suggesting that the coin remains in a downswing. That said, the fact that both indicators are low suggests ETH is due a rebound rally sooner or later.

Of course, with the market still reeling from the FTX bankruptcy, this may be later rather than sooner. This is largely because the collapse of the second-biggest exchange in the world is still likely to have contagion effects, with crypto-based lender BlockFi reportedly preparing for bankruptcy after it paused activities and admitted “significant exposure” to FTX.

With other exchanges suffering apparent runs on withdrawals, it remains highly possible that further dominoes could fall in the coming days and weeks. This would imply further market losses, something which certainly wouldn’t spare ETH and its price.

In addition, ETH remains one of the fundamentally strongest coins in the market. It famously and successfully completed a transition to a proof-of-stake consensus mechanism in mid-September, while it’s comfortably the biggest layer-one blockchain in terms of total value locked in.

ETH has also become deflationary since September’s Merge, with fewer new coins being issued and more coins being burned. This only improves the bullish case for its more distant future, with it due a big rise once the market and global economy turns a corner.

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