Ethereum price is crashing, erasing some of the recent gains as traders started to book profits after a successful surge. ETH token was trading at $4,415 on Saturday, down by 7.85% from its highest point this year. This article explores the bullish case for ETH price this year.
Ethereum price has strong technicals
The first key reason why Ethereum price may keep surging this year is that it has strong technicals. The weekly chart shows that it has soared from a low of $1,400 in April to a high of $4,800 last week.
It has crossed the important resistance level at $4,113, its highest swing in March and November last year. Moving above that level was notable as it invalidated the highly bearish triple-top pattern.
The token has formed an inverse head-and-shoulders pattern whose neckline is at $4,113. It also remains above the 50-week and 100-week Exponential Moving Averages (EMA), a sign that bulls are in control.
The Relative Strength Index (RSI) and the MACD indicators have continued rising, a sign that it has the momentum.
Therefore, the most likely scenario is where it continues rising, with the next pont to watch being at $5000.
However, there is a risk of a bearish pullback, as it has formed a shooting star pattern, characterized by a small body and a long upper shadow. This pattern often leads to a brief pullback.
A drop to the support at $4,113 will be a positive catalyst as it will be a sign of a break-and-retest pattern, a popular continuation sign.
Ethereum DeFi ecosystem is growing
The other major catalyst for the Ethereum price is that it maintains its lead as the biggest and most dominant player in decentralized finance (DeFi) with over $202 billion in total value locked.
In contrast, Solana, the second-biggest player in the industry, has $22.5 billion, while BSC, Bitcoin, and Base have $10.3 billion, $10.1 billion, and $6.7 billion.
Most importantly, its bridged TVL has jumped to $521 billion, also much higher than other chains. Bridged TVL is the total value of assets that are locked across multiple blockchains through bridges.
Ethereum has also become the biggest player in the stablecoin industry with over $142 billion. Data shows that it handled stablecoin transactions worth over $893 billion in the last 30 days, as the number of stablecoin addresses soared by 52% to 2.6 million.
Read more: Ethereum price target raised to $7,500 by Standard Chartered on stablecoin boom
ETH ETF inflows are soaring
The other main bullish catalyst for ETH price is that American investors are in an accumulation mode. ETH funds added over $547 million in assets last week, higher than the previous week’s $246 million. A surge in ETF inflows is a sign of increased accumulation among institutional investors.
NFT market share
Ethereum price may continue rising as its dominance in the non-fungible token industry continues. Data shows that it had over $353 million in sales in the last 30 days, a 68% increase.
This increase was driven by CryptoPunks, which had $87 million in sales, Bored Ape Yacht Club, and Pudgy Penguins. Its sales were much higher than Bitcoin’s $55 million and BNB Chain’s $55 million.
Read more: Top 4 reasons Ethereum price is in an unstoppable bull run
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