Ethereum's current rally appears similar to 2019. Multiple technical and fundamental indicators are signaling ETH can reach over $3k by the end of September.
FUNDAMENTAL BULL-CASE
TECHNICAL BULL-CASE
Investor FOMO should increase dramatically as ETH crosses $2k and $2.5k. By factoring in all of the details mentioned above, I expect ETH will move aggressively upwards for the next month and peak above $3k by the end of September.
FUNDAMENTAL BULL-CASE
- Decreasing Fed aggression: Markets interpreted the previous FOMC as representative of a decrease in Fed aggression. Subsequently, markets have lowered near-term rate hike expectations and expect rate cuts in 2023. Source
- Decreasing inflation: Risk-on assets have priced in a 'peak inflation' narrative since June's 9.1% CPI report (released on July 13th). This narrative strengthened after July's CPI registered lower than expected at 8.5% (released on August 10th).
- Decreasing US Dollar value: The Fed's head-start on aggressive monetary tightening drove up the value of the US dollar through 2021 and 2022. Now, this head-start is working against the US, as the Federal Reserve must moderate its monetary policy while other central banks continue tightening.
TECHNICAL BULL-CASE
- Ethereum's bottom at $882 on June 18th completed a two-year-long Elliott wave structure. This current wave structure resembles ETH's 2017 - 2018 hype cycle. During the previous cycle, ETH pumped 338% after bottoming 94% below its all-time high at $83/ETH on December 7th, 2018.
- By mirroring Ethereum's previous waves and scaling proportionately, we can see ETH has legs to increase to $3,480 by October 28th, 2022. The calculations for this prediction are explained in the chart notes.
- The 0.618 retracement between Ethereum's all-time ($4,880) and local bottom ($882) is $3,358/ETH.
- The 2022 Autumn Equinox will occur on September 22nd, 2022. This lines up with the Fed's next FOMC meeting, scheduled for September 19th & 20th, and Ethereum's 2.0 Merge, planned for September 15th. The alignment between these three dates implies that ETH will top near the end of September.
Investor FOMO should increase dramatically as ETH crosses $2k and $2.5k. By factoring in all of the details mentioned above, I expect ETH will move aggressively upwards for the next month and peak above $3k by the end of September.