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3 Reasons Ethereum Price Is Approaching $ 600

Together with the great anticipation for Ethereum 2.0, The timeframe breakout and daily gas consumption on Ethereum remain important positive drivers.

Eth2 momentum accelerates in correlation with price

The Eth2 mainnet will start when the amount of Ether (ETH) stuck towards the Eth2 deposit contract reaches 524,288.

The data from CryptoQuant found that the stake value at the address of the Eth2 deposit contract shows a correlation with the ETH price.

ETH price against total value when using eth2.0. Source: CryptoQuant
3 Reasons Ethereum Price Is Approaching $ 600
3 Reasons Ethereum Price Is Approaching $ 600

Ki Young Ju, CEO of CryptoQuant, noted that the correlation seems to increase with the upcoming release date. Wrote::

“With the upcoming release date of ETH 2.0, the correlation between the price of ETH seems to increase.”

This trend was expected by analysts because of the importance of Eth2. When activated, Eth2 is expected to improve the transaction capacity of the Ethereum blockchain network.

Since almost $ 300 million worth of ETH would be deposited towards the Eth2 deposit contract, This could also reduce the selling pressure on ETH in the long term.

Breakdown of the long-term framework

The ETH price exceeded USD 500 for the first time since May 2018, exceeding a two-year range. Since then it’s already risen above $ 580, This shows strong momentum and little resistance above $ 620.

If ETH breaks above $ 620, the next high timeframe resistance will be at $ 784, $ 915, and $ 1,200, respectively.

ETH / USD weekly chart. Source: TradingView.com

Traders expect ETH to hit $ 620 in the short term and possibly consolidate until the next outbreak occurs.

A dealer known as “Beginner“” said What ETH could reach $ 620 in a few days as it has strong technical dynamics.

Although prices for Bitcoin (BTC) and ETH fell over the weekend, Analysts say TWAP algorithms could bring the momentum back to life. Qiao Wang, trader and quantitative analyst, wrote::

“The reason there are weekends is because they shake weak hands before institutional buyers reactivate their TWAP algorithms on Monday.”

Basics support the rally

According to the chain data of Etherscan, Daily gas consumption on Ethereum is at an all-time high.

The term “gas” refers to the transaction fees on Ethereum’s blockchain network. When the gas consumption is high, the activity of the chain users increases.

Daily gas consumption at Ethereum. Source: Etherscan

The increase in daily gas consumption is likely due to two causes: Deposits to the Eth2 address and a growing number of decentralized finance or DeFi users.

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