Cointelegraph By Yashu Gola
Ethereum’s native token, Ether (ETH), eyes a run-up toward $3,000 in Q2 2023 after wrapping the previous quarter with 55% gains.
ETH price nears potential breakout
The price of Ether has more that doubled after bottoming out in June 2022 at around $880, weathering a slew of negative events, including the FTX exchange collapse, interest rate increases, and stricter U.S. regulations.
In doing so, ETH/USD has painted an ascending triangle, confirmed by its rising trendline support and horizontal level resistance. The pattern suggests aggressive buying as lows get steadily higher while highs stay around the same level, indicative of a higher selling pressure at the given level.
As of April 2, ETH’s price is testing its horizontal level resistance range ($1,700-1,820) for a potential breakout move.
A breakout will be confirmed if the price closes above the resistance range while accompanying higher volumes. Furthermore, the ascending triangle breakout target is measures with the length equal to the triangle height.
In other words, the bullish ETH price target is in the $3,350-3,900 range, depending on where traders see the triangle’s rising trendline support, as shown by the T1 and T2 in the chart above. This would be suggest 80% gains by June 2023.
Conversely, a pullback from the $1,700-1,820 range risks delaying the upside setup, and resulting in a broader price correction.
Ethereum whale accumulation remains strong
From an on-chain perspective, Ether’s short-term and long-term trends look skewed toward the bulls.
Most Ethereum whale cohorts have increased their ETH accumulation in recent weeks, according to the latest data from Santiment. For instance, the supply of Ether held by addresses with a 1,000-10,000 ETH balance (blue in the chart below) has grown by 0.5% in March.
Similarly, the 1 million-10 million ETH (brown) and the 10 million-100 million ETH balance cohorts have witnessed 0.4% and 0.5% rises, respectively.
The growth appeared amid what appears to be the absorption of selling pressure introduced by the 100,000-1 million ETH (pink) and 10,000-100,000 ETH (orange) address cohorts.
At the same time, the growth could attributed to the network’s proof-of-stake contracts — directly or by using third-party stakers such as Lido DAO (LDO).
The net Ether deposited at the official Ethereum 2.0 address crossed above 18 million ETH after rising about 3.5% in March.
Related: Analysts debate the ETH price outcomes of Ethereum’s upcoming Shapella upgrade
The deposits have grown ahead of Ethereum’s Shanghai and Capella upgrades on April 12, which would enable stakers to withdraw ETH from the PoS smart contract. Currently, this is not possible.
MVRV Z-Score: Ethreum price bottom reversal
More bullish arguments stem from Ethereum’s MVRV Z-Score entering a stage that has previously preceded long-term ETH price rallies.
The MVRV Z-Score assesses when Ethereum is overvalued and undervalued relative to its “fair value.” As a rule, the MVRV Z-score indicates a market top (red zone) when market value rises above realized value, while the opposite indicates market bottoms (green zone).
Ether’s previous price recoveries coincide with its MVRV Z-Score bouncing from the green zone, suggesting the same could happen over the next three months.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
