• Ethereum needs to defend $1,180 to sustain a 50-day ascending pattern, setting the stage for a potential rally to $1,330 by March 2023.
• Layer-2 technologies such as Optimistic Rollups have the potential to improve Ethereum scalability and provide off-chain network storage.
• The unexpected move negatively affecting the competing smart chain platform Solana has likely helped to fuel Ethereum investors’ expectations.
Ethereum has been ranging near $1,200 since Dec. 17, but an ascending trend has been quietly gaining strength after 50 consecutive days, pointing to $1,330 or higher by March 2023. This makes it essential for bulls to defend the current $1,180 support. The anxiously awaited migration to a Proof of Stake in September 2022 paved the way for additional layer-2 integration and lower transaction costs overall. Layer-2 technologies such as Optimistic Rollups have the potential to improve Ethereum scalability by 100x and provide off-chain network storage.
Developers anticipate that the network upgrades scheduled for 2023 introducing large portable data bundles can boost the capacity of rollups by up to 100x. Moreover, in December 2021, Vitalik Buterin shared that the end game was for Ethereum to act as a base layer, with users “storing their assets in a ZK-rollup (zero knowledge) running a full Ethereum Virtual Machine.”
An unexpected move negatively affecting the competing smart chain platform Solana has likely helped to fuel Ethereum investors’ expectations. Two noticeable non-fungible token projects announced on Dec. 25 an opt-in migration to Ethereum, further indicating the network’s potential.
ETH price bulls struggle as futures remain trading below its fair value, signaling excessive demand for shorts. This is a clear indication of investor’s mistrust towards the cryptocurrency and its underlying technology. In order to sustain the ascending trend, Ethereum must defend the $1,180 support and acquire a decent momentum to break past the near-term resistance at $1,220 and reach its all-time high of $1,400.
Overall, the market sentiment towards Ethereum is bullish and investors are confident that the network upgrades and layer-2 integration will help the cryptocurrency reach new heights in the coming months. With the current price movements, Ethereum could reach its target of $1,330 or higher by March 2023, making it an attractive investment option for traders.