Ethereum’s native token Ether (ETH) moved above $2,600 on Wednesday, but would need help from buyers to consolidate.
Earlier, Ethereum Foundation announced rebranding of the Eth1 and Eth2 blockchains.
NEW DELHI (CoinChapter.com) — Ethereum’s native token, Ether (ETH), moved above the $2,600 price level today. After falling 24% in the week beginning Jan 17, the Ethereum token is slowly recovering its losses from the Jan 21 market crash.
The downtrend continued on Jan 24, but the long wick on the bar shows bulls aggressively bought the dip. Afterward, ETH has been moving upwards. However, the Ethereum token is still down 9.9% over the last seven days, as per CoinMarketCap data.
Although the prime altcoin has been moving upwards since Jan 25, an upcoming bearish technical indicator might pull ETH’s price down. In detail, the token’s 50-day Moving Average line is moving downwards and may soon cross below Ethereum’s 200-day MA line, painting a death cross.
A death cross often indicates negative sentiment for an asset and the potential for a major sell-off. On Jan 26, the token jumped 10.3% from the day’s low of $2,417 to reach a high of $2,665 before prices pared. Furthermore, ETH’s failure to move above resistance $2,707 indicates bears are profit-booking on minor relief rallies.
If Ethereum manages to flip its immediate resistance, it could move to $2,841. The key price level of $3,000 would be a key price target for Ethereum.
Meanwhile, ETH’s RSI has moved back into neutral regions on Jan 26 after being oversold since Jan 20. Traders often consider the upward movement of the RSI trendline as a bullish indicator.
Ethereum’s MACD Moving Towards Bullish Region
On the other hand, if ETH fails to rally upwards, Ethereum prices could drop to immediate support at $2,427. Further sell-off could pull down prices near support at $2,320. Moreover, the $2,320 support level survived ETH’s downtrend during the recent crash.
Furthermore, Ethereum is currently bearish across time horizons, as the ETH prices trade below the 50-day, 100-day, and 200-day MA lines.
Meanwhile, though bearish currently, trend-based momentum oscillator MACD is showing signs of bullishness. Bars on the MACD histogram, which plots the difference between the MACD line (difference between 12-day and 26-day EMA) and the MACD signal line (9-day EMA of MACD), are currently in the bearish regions.
However, the histogram bars are contracting, indicating the MACD line is moving upwards due to the strengthening bullishness.
Ethereum Foundation Rebrands ETH 2.0
In a statement released Monday, the Ethereum Foundation has decided to phase out ‘Eth1’ and ‘Eth2’ (Ethereum 2.0).
As per the announcement, the foundation has decided to rename Eth1 as the Execution Layer and the name Consensus layer for Eth2. To recap, Eth 2.0 is an upgrade to the existing Ethereum network, shifting the platform from the existing proof-of-work to the more efficient proof-of-stake consensus mechanism.
The upgrade would likely go live in either the second or third quarter of 2022. Announcing the change, the Ethereum Foundation gave several rationales, including a ‘broken mental model for new users of Ethereum,’ inclusivity, scam prevention, and staking clarity.
According to the foundation, the Eth2 branding makes new users think Eth1 came before Eth2, or Eth1 would expire after Eth2 comes into existence. ‘By removing Eth2 terminology, we save all future users from navigating this confusing mental model,’ the announcement stated.
Another reason was to bring more clarity to users and hinder scammers. The foundation highlighted how malicious elements dupe victims into “swapping” their ETH for the “newer ETH2 tokens.
Lastly, the rebranding should bring more clarity to ETH staking. The foundation said some operators are branding the ETH staked on Ethereum’s Beacon Chain with the ‘ETH2’ ticker. Ethereum’s statement added–
This creates potential confusion, given that users of these services are not actually receiving an ‘ETH2’ token. No ‘ETH2’ token exists; it simply represents their share in that specific providers’ stake.
However, the news received a lukewarm response from the Ethereum community. A majority of users on the r/Ethereum subreddit either joked about the move or complained about the timeline for the merge.
One user, CartographerWorth649, noted that the rebranding might be an effort to mitigate the ‘bad rap’ from the delay in the arrival of Ethereum 2.0.
At the time of writing, ETH was trading at $2,619, up 6.5% on the day.
A Delhi-based Markets writer, I did my bachelor's in engineering with major in electronics and communications. I first heard of bitcoin while writing an article about blockchain technology a few years back, and have been following it ever since. Bitcoin may well be current big thing happening in the finance industry, and it feels like the right time to join the crypto bandwagon.