Ethereum price bounced back on Thursday as the crypto fear and greed index and Bitcoin continued their strong rally. ETH, the second-biggest cryptocurrency, was trading at $3,280, up from this week’s low of $3,000.
Solana could flip Ethereum
ETH price has continued to underperform other cryptocurrencies this month. For example, while Bitcoin is at a record high of near $100,000, Ether remains 32% below its all-time high and 20% below the highest point this year.
Ethereum is facing substantial challenges, especially as investors turn their focus on Solana, which has become the favorite blockchain for most developers. A good example of this is in the Decentralized Exchange (DEX) industry.
Data by DeFi Llama shows that Solana’s DEX networks handled over $52 billion in volume last month while Ethereum processed $42 billion. This trend has continued at a faster rate this year as Solana DEX handled $91.5 billion against Ethereum’s $45 billion.
Solana is gaining market share, and analysts believe that ot could overtake Ethereum in the next few months. Ethereum has a market cap of $396 billion against Solana’s $130 billion. As such, if Solana gains momentum and Ethereum’s price action stalls, there is a real chance that it will become the second-biggest coin in the industry.
Ethereum has also suffered as many whales have started to sell their coins. For example, one whale moved ETH tokens worth $35 million to Coinbase, the first step towards a sale. Altogether, whales have moved coins worth over $100 million to exchanges.
A key issue has been that Ethereum’s network has faced major challenges because of its centralization, higher fees, and slow transaction costs. Ethereum ETFs have also had outflows in the past five consecutive days, a weird situation since Bitcoin had over $790 million in inflows on Wednesday.
Ethereum price forecast
The daily chart shows that the ETH price has risen gradually this week, reaching a high of $3,440. This was an important level since it coincided with the falling trendline that connects the highest swings since March. Ethereum price has formed a symmetrical triangle pattern and moved above the 50-day and 100-day moving averages.
ETH price has also formed what looks like a bullish flag pattern, which is a popular bullish sign. If this pattern works out, the coin will likely have a strong bullish breakout, with the next point to watch being the year-to-date high of $4,086, its highest point in March. A drop below the support at $2,800 will invalidate the bullish view.
