On Friday, Ethereum experienced a significant surge, surpassing the $2,000 resistance level with a gain of more than 10% in just a few days. This growth was primarily driven by the rising popularity of decentralized finance (DeFi) applications, which are built on the Ethereum blockchain and provide various financial services without intermediaries.
The anticipated Ethereum 2.0 upgrade also played a key role in this surge. The upgrade promises improved network scalability and security, which sparked optimism among investors and led to increased buying pressure on Ethereum.
From a technical perspective, Ethereum traded above $2,050 and the 100-hour simple moving average, indicating a positive trend supported by a short-term bullish channel. However, the cryptocurrency faces a significant hurdle at the $2,135 resistance level. Failure to overcome this resistance could lead to a downward correction with immediate support levels at $2,115 and $2,080 and major support at $2,000.
The price spike followed Ethereum’s milestone breakthrough on Thursday, when it broke through a key resistance level and saw a price spike of over 2%, ensuring the token’s value stayed above $1,900 and traded at $1,914.42.
Market indicators played a crucial role in these developments, with the bullish Moving Average Convergence Divergence (MACD) indicating favorable market conditions and Bollinger Bands signaling high price volatility. Ethereum’s Relative Strength Index and Chaikin Money Flow also remained high.
Despite facing heavy selling pressure on Wednesday, which led to a sharp drop in weighted sentiment during the rally, data from CryptoQuant on Thursday showed optimism with high active addresses and transferred volume for Ethereum. In the futures market, the dominant buying sentiment was indicated by a green funding rate and a buyer/seller ratio. Cubic (NYSE:CUB) Analytics confirmed these developments as a milestone breakthrough for the cryptocurrency.
