As a seasoned crypto investor with a keen interest in Ethereum, I’m thrilled to see the recent surge in its price. After weeks of mundane and directionless trading, Ethereum is now on track to reach new historical milestones, with $4,000 being a likely target this week and potentially even $5,000.
As an analyst, I’ve noticed a shift in Ethereum‘s price action over the past few weeks, moving away from aimless trading. It now appears poised to reach the significant mark of $4,000 this week and potentially advance further towards $5,000 – a new historic high.
Based on the ETH–BTC chart, the largest smart contract token has surpassed its May low of 0.04473BTC by over 18%, implying it has started its journey away from that price point.
Why Optimism For Ethereum ETF Approval Jumped By 75%
As a crypto investor, I’ve noticed a significant shift in the outlook for spot Ethereum ETFs in the US over the past few months. Previously, there was a strong sense of optimism that approval was imminent. However, this hope has waned considerably until recently. The consensus among potential ETF operators is that their engagement with the Securities and Exchange Commission (SEC) hasn’t been as productive as they had anticipated. In contrast to the relatively smooth process leading up to the approval of Bitcoin ETFs on January 10, Ethereum ETF hopefuls have faced more obstacles in gaining the SEC’s approval.
Regulators in the US have taken a cautious stance towards Ethereum’s classification, with some industry insiders arguing that the likelihood of an Ethereum exchange-traded fund (ETF) materializing is slim if Ether is deemed an unregistered security.
Based on recent developments, I’ve observed a shift in the SEC’s stance regarding the potential approval of the industry’s second Exchange-Traded Fund (ETF) product. Accordingly, analysts at Bloomberg have raised the likelihood of approval from a slim 25% to a more promising 75%.
Eric Balchunas, a well-known ETF analyst at Bloomberg, expressed his belief on Monday that recent developments had heightened the likelihood of the Securities and Exchange Commission (SEC) changing its stance on this contentious issue. He implied that there might be rumors circulating about such a reversal from the SEC.
Balchunas added that like everyone else, he believed that spot Ethereum ETFs would be “denied.”
Revised: JSeyff and I have raised our estimation of Ether ETF approval likelihood to 75% (previously at 25%). Recent whispers suggest the SEC may reconsider this contentious matter, causing a flurry of activity among those who had assumed a denial. Observe…
— Eric Balchunas (@EricBalchunas) May 20, 2024
In my analysis on Tuesday, I noted that the probability of an Ether Exchange-Traded Fund (ETF) approval dropped to 25% based on the agency’s silence and ambiguous discussions surrounding the ETF in the market.
As a researcher studying the recent developments in the world of Ethereum Exchange-Traded Funds (ETFs), I’ve come across an intriguing perspective from Balchunas. He indicates that the approval process for these spot Ethereum ETFs has escalated into a significant political issue. Consequently, it seems plausible that the SEC’s sudden shift was influenced by an influential figure – perhaps even President Joe Biden himself – making an unexpected last-minute intervention. In his X post, Balchunas sheds light on the factors leading to this change.
Despite it doing so, the percentage doesn’t drop to zero. Intriguingly, we kept a modest possibility open during the bitcoin approval process for Biden to intervene at the last minute and have the SEC reject it, given the Democratic party’s previous stance against cryptocurrencies just a few months ago. Life can be quite dynamic.
— Eric Balchunas (@EricBalchunas) May 21, 2024
The ETF’s approval has significantly boosted Ethereum’s price, which had previously dipped down to $2,800 earlier in the month.
If Ethereum is now priced at around $3,785 before a potential approval, it’s very probable that the price will surpass $4,000.
ETH/BTC Price Prediction: How Far Will Ethereum Price Rally Go
On the four-hour chart, the ETH/BTC pair broke through a prolonged downward trend line, supported by various signs such as the Relative Strength Index (RSI) sitting at 85, indicating an overbought state.
Two golden cross formations have emerged, bolstering the optimistic perspective. The initial pattern arose when the blue 20-day Exponential Moving Average (EMA) surpassed the red 50-day EMA. More recently, the same 20-day EMA rose above the purple 200-day EMA, further strengthening the bullish trend for the pair.
During US trading sessions, the ETH–BTC exchange rate hit a mark of 0.05528 Bitcoins. The price faces resistance at approximately 0.05346 Bitcoins, which has previously capped gains. Overcoming this hurdle could potentially boost Ethereum’s value relative to Bitcoin, potentially reaching new highs above 0.06 Bitcoons.
If the significant shift in the ETH/BTC market occurs, it’s reasonable to anticipate an even more substantial surge in the ETH/USD pair. This uptrend might push ETH above $4,000 by week’s end, fueled by the impending ETF approval. Ethereum investors are bracing for potential new record highs, potentially surpassing the $5,000 threshold.
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2024-05-21 17:33