Ethereum Price Prediction: ETH Readies For 13% Gains To $2100

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Ethereum (ETH) has been locked within a tight price range defined by two major moving averages. This has kept the price above the $1,800 level but sealed under the $1,900 level since May 9. At the time of writing, Ethereum price was teetering around $1,858, up 2.5% on the day and 2.11% over the past week.

Meanwhile, Ethereum founder Vitalik Buterin warned against the overloading of the Ethereum network saying re-staking initiatives or Layer-1 soft forks could hurt the network’s consensus. While giving the green light to the dual use of Ether staked by validators, Buterin condemns the use of social consensus for layer-2 applications.

Ethereum consensus layer could be overwhelmed – Buterin

On Sunday, Vitalik Buterin, the Ethereum co-founder, published a blog post warning against the risks of overloading the Ethereum consensus layer. While he is in support of dual use for staked ether, he said the overuse of Ether’s consensus layer from Layer 2 apps could overwhelm the blockchain.

In his blog post, Buterin addressed issues around re-staking initiatives or Layer 1 soft forks on the Ethereum blockchain.

Don't overload Ethereum's consensus:https://t.co/07tzyCrZcJ

— vitalik.eth (@VitalikButerin) May 21, 2023

The co-founder highlighted several instances that could pose high systemic risks to the network including:

Proposals where users can vote on what facts are true by sending ETH, everyone who sent ETH to vote for the majority answer gets a proportional share of all the ETH sent to vote for the minority answer.
Re-staking Ethereum stake and using it to “vote” instead of in-protocol incentives.
Layer-1 driven recovery of layer-2 projects, in the event that L2 has a bug and L1 forks are used to recover it.

According to Buterin:

“dual-use of validator staked ETH, while it has some risks, is fundamentally fine, but attempting to “recruit” Ethereum social consensus for your application’s own purposes is not.”

The Ethereum founder’s objectives are apparent: to sustain the resilience and stability of the Ethereum blockchain. Situations like re-staking and soft forks make the Ethereum consensus layer vulnerable to unexpected forks, or a community split among validators.

ETH is the native token of the smart contracts blockchain, and a fork or split could negatively influence the asset’s utility, adoption and price in the long term.

Ethereum price bullish on the daily timeframe

After turning away from the $2,116 range high on May 19, the Ethereum price has recorded a series of lower highs and lower lows. This price action has led to the appearance of a falling wedge on the daily chart.

ETH was seeking to escape from the falling wedge which will be confirmed once the price produces a daily candlestick close above the upper boundary of the governing chart pattern at $1,870.

Such a move will bolster the buyers to push the price past the stubborn hurdle at $1,889, embraced by the 50-day Simple Moving Average (SMA). If this happens, Ethereum price may rise to tag the $2,000 range high or higher toward the $2,116 range high. This would represent a 13.73% increase from the current level.

ETH/USD Daily Chart

Ethereum Price Chart - — TradingView Chart: ETH/USD

Ethereum’s upside was supported by the up-facing SMAs and the upward movement of the Relative Strength Index (RSI). The price strength at 52 suggested the bulls were re-entering the market and were determined to scale the Ethereum price higher.

Also supporting the positive narrative for the Ethereum price was the upward movement of the Moving Average Convergence Divergence (MACD) indicator. Note that this oscillating indicator had just called to buy Ethereum on the daily chart.

This occurred on May 22 when the 12-day Exponential Moving Average (EMA) crossed above the 26-day EMA. This suggested that the market conditions favored the upside.

On the other hand, Ethereum could turn down from the current levels to produce a daily candlestick below the 100-day SMa at $1,780. This would trigger massive sell orders that could send ETH below the wedge’s support line at $1,720 to revisit the $1,700 and $1,600 psychological levels.

In highly bearish cases, Etherum price may drop toward the 200-day SMA currently sitting at $1,568. This would be a 15% decline from the current price.