Ethereum (ETH-X) fell initially on Wednesday to reach down towards that 3000 region yet again. However, we have turned around to bounce and show signs of support. At this point, the market looks as if it is trying to form a little bit of a short-term “double bottom”, but it is worth noting that we are near the $3000 level.

Photo by Kanchanara on Unsplash

It is also worth noting that the 61.8% Fibonacci retracement level sits just below the $3000 level as well, and the 200 day EMA is floating around in this general vicinity. Whether or not we can rally enough to take out the top of a potential “W pattern” at the $3400 level is a completely different question, but it certainly looks as if we are trying to at least take the first steps to make this happen. After all, Ethereum has a big year ahead of it, and it is difficult to imagine a scenario where this thing will completely falls apart from this low level. If it does, full disclosure: I will be buying Ethereum at much lower levels hand over fist.

This year has a significant amount of events coming out for the Ethereum ecosystem, and I think it does have a lot to say when it comes to the pricing of Ethereum. After all, we have so-called “Ethereum 2.0” coming out, and a ton of other DeFi projects in the works that work on top of Ethereum. Furthermore, as a layer one, there will be a lot of demand when it comes to the underlying blockchain, so I think Ethereum has a good year ahead of it.

At this point, I do believe that we will see $4000 during the course of the year, perhaps even reach towards the $5000 level. That being said, I do not know where the selloff ends. Unfortunately, Bitcoin (BITCOMP) continues to have its influence on this market, so we need to see Bitcoin hold its act together. If it does, then that will have people looking towards other markets such as Ethereum in order to boost profits. I do think that it is probably only a matter of time before we see value hunters coming back in, but the best thing that we can see in the short term will be stability.

(Click on image to enlarge)