Next Stop: ETH $2K (2/4/21 Forecast)
(February 3, 2021 8:30 PM EST)
We finally got our breakout and we are cruising! ETH pushed to higher highs straight away as the buyers continue to pour in with Grayscale buying another 25,000 ETH last week to bulk up their reserves, and of course retail demand is high, institutional demand is rising, and DeFi and all dApps built on the Ethereum network continue to grow at an amazing pace. Once we reach $2,000, and that’s a when — not if — we could absolutely continue higher straight away — but I think it could serve as resistance as a large, round psychological number, so if ETH were to pullback there, I would eagerly look for a pullback to $1,400 — $1,500 to then find support, marking a higher low and officially declaring a new support level which would be a great area to reload longs for the run higher, as you can see my crude price path in the chart above.
When looking at the ETH/BTC chart below, you can see ETH impulsively broke out above the 0.04 ETH/BTC level on Tuesday and followed through Wednesday, reaching up to the 0.044 level, closing the daily candle near the highs. From here, ETH should look to move higher, first to 0.05 and then 0.06, which would boost ETH/USD’s price to $1,700 and $2,000 respectively. We’re nearly at the former, so $2,000 is my minimum target here. With BTC on the rise, 0.06 of say, $40K = $2,400, so ETH could easily run up to ~$2,500 here, though I suspect we might find a bit of resistance at $2K first.
Simple strategy: Buy the dips and earn ETH however possible. Otherwise, DCA on a weekly/biweekly basis, whatever you can afford. Historical charts and models all point to 2021 being substantially better for crypto and ETH in particular, although ETH has outperformed BTC in 2020 so really it’s no surprise there.
Support: $1,200 is immediate support with $1,000 as stronger support. Now that ETH has impulsively broken above the $1,400 — $1,500 resistance region which has given us so much trouble as of late, we should see that area become new higher support, which will be confirmed with a test on a retrace at some point during or after this push up.
Resistance: All eyes are now on $2,000, then $2,500. The former would be a clean resistance level, though crypto is rarely clean so we could see a stronger momentum push up to $2,500 or possibly even $3,000, but let’s take it one day at a time and see what tomorrow brings.
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