The price of Ethereum (Ethereum-ETH), the second largest digital currency by market capitalization and the base currency for the Ethereum blockchain based on smart contracts, rose nearly 5% yesterday, Thursday, to reach its highest levels this year above $2,300.
The Ethereum blockchain maintains its dominance in the decentralized finance (DeFi), non-fungible tokens (NFTs) and other web3 projects, and represents about 70% of the $107 billion total value locked (TVL) in the crypto sector, which They are held as cryptocurrencies in smart contracts, according to DeFi Llama.
Ethereum has witnessed a rise in recent weeks amid renewed appetite for risk in the crypto market in general, which led to a rise in the price of Bitcoin (BTC) this week, recording its highest levels this year by exceeding $44,000.
This overall rise came amid optimism regarding the expected approvals of exchange-traded funds (ETFs) for spot trading of Bitcoin, in addition to the possibility of looser monetary policies by the US Federal Reserve, which may lead to a more growth-friendly liquidity environment.
Ethereum is expected to achieve significant gains in the near term thanks to several factors, such as major asset management companies - such as BlackRock - submitting a request to create exchange-traded funds for spot trading of Ethereum (ETH), in addition to the recent return of Ethereum supply. Due to its deflationary nature thanks to the improvement in activity on the Ethereum blockchain, in addition to the fact that Ethereum has lagged significantly behind keeping up with Bitcoin in rising this year (as Ethereum has risen by 96% since the beginning of the year compared to Bitcoin’s rise by 164%), which increases the possibility of it rising soon.
In any case, recent technical developments also indicate the possibility of a further rise in the price of Ethereum, with the possibility of the price outlook remaining positive in the near term.
Ethereum Price Forecast: Will the price reach $3,500 by December 31?
Ethereum (ETH) price recently rose above the major long-term resistance level near $2,150, and managed to find strong support above this level.
Chart analysis shows that there are not many major resistance levels for Ethereum to reach its 2022 highs at the $3,500 area, which means the possibility of a rapid rise of nearly 50% in the near future.
Ethereum (ETH) price chart
It is unlikely that ETH will be able to rise to this level before December 31 (i.e. within approximately three weeks), but this remains possible due to its occurrence previously. In late July 2020, Ethereum rose by 57% within two weeks, followed by a rise By more than 80% in the last week of 2020 until the first week of 2021. This currency also previously witnessed gains of more than 70% in the last week of April until the first week of May 2021.
Combined with technical aspects and fundamentals in what is usually a favorable season for the cryptocurrency market (i.e. with strong possibilities for holiday season spikes), the possibility of Ethereum (ETH) reaching $3,500 this year should not be ruled out.
