- Ethereum price has remained in a consolidation phase in the past few days.
- ETH will benefit if the SEC approves a spot Bitcoin ETF.
- Ethereum is facing substantial competition from the likes of Bitcoin and Solana.
Ethereum price remained in a consolidation phase this week as traders waited for the next catalyst. ETH was trading at $2,370 on Wednesday morning, a few points below the December high of $2,446. In all, the coin has risen by about 107% from its lowest level in 2023.
Competition rises
Ethereum price will be in the spotlight in the coming days as the Securities and Exchange Commission (SEC) delivers its verdict on a spot Bitcoin ETF. The agency has until January 10th to decide whether to approve, delay, or reject applications by companies like Blackrock, VanEck, and Franklin Templeton.
The theory is that the approval of a spot Bitcoin ETF will see these companies move to Ethereum, the second-biggest cryptocurrency in the world. This explains why Grayscale’s Ethereum Trust (ETHE) discount to NAV has narrowed in the past few days. Companies like Blackrock and Fidelity have already submitted their applications for this.
If a spot BTC ETF is approved, the SEC will likely also approve an Ethereum one. The challenge is that Gary Gensler, the head of the agency still believes that Ethereum is a financial security because of its staking features.
Read more: Here are the best Ethereum exchanges.
Ethereum price has also been in the spotlight as competition in its industry rises. Most of this competition is coming from other layer-1 networks like Solana, Avalanche, and Tron. Bitcoin is also giving it competition in the NFT industry.
For example, data compiled by CryptoSlam shows that Ethereum NFT sales in the past 30 days dropped by 18.80% to $345 million. The number of buyers and sellers were 59k and 47k, respectively.
In the same period, the total Bitcoin Ordinals sales were over $875 million. Solana NFT sales rose by over 240% to over $329 million. This is a major issue since Ethereum dominated the industry a few months ago.
Ethereum’s DeFi trends are also not all that strong. Total Value Locked (TVL) in the ecosystem jumped by less than 2% in the past 30 days. In the same period, Solana rose by over 125% while Base and Cardano rose by 40% and 50%, respectively.
Ethereum price forecast
The daily chart shows that the ETH price has remained in a consolidation phase in the past few days. It has found substantial resistance at $2,446, where it failed to move above in 2023. The coin is still being supported by the 50-day and 25-day Exponential Moving Averages (EMA).
ETH price is also above the crucial support level at $2,142, its highest swing on April 16th and November 10th. At the same time, the Relative Strength Index (RSI) and the MACD have formed a bearish divergence pattern.
Therefore, the outlook for Ethereum is bullish for now, with the next psychological level to watch being $3,000. This view will be confirmed if it flips the resistance at $2,500 into a support level.
