- Ethereum has pressed higher after falling as low as $310-315 just days ago.
- The coin now trades for $370 and traded as high as $375-378 just hours ago.
- The coin is not entirely bullish, though, despite the recovery from the aforementioned lows.
- Analysts remain bullish on Ethereum from a longer-term perspective.
- They cite trends in decentralized finance and what effect that will have on ETH.
Here’s Why Ethereum Isn’t Bullish… Yet
Edward “Teddy” Cleps, a prominent crypto trader, thinks Ethereum isn’t in a bullish state just yet. The analyst shared the chart below, noting that the recent rally may just constitute a bearish retest as opposed to a bullish breakout :
“Price retested previous support as resistance – currently looks like a rejection. Vital for bulls to push back above for lambo season.”
Chart of ETH's price action over the past few months with analysis by crypto trader Edward "Teddy" Cleps. Chart from TradingView.com
Positive Fundamental Trends
While Ethereum may be stalling due to a slowdown in legacy markets and in Bitcoin, the asset’s fundamentals are still strong. That’s according to a number of cryptocurrency investors and analysts.
Chris Burniske, a partner at Placeholder Capital, recently postulated that Bitcoin and Ethereum will race each other to a $1 trillion market capitalization. That suggests the former ARK Invest crypto-asset analyst sees ETH starting to catch up to BTC’s market value.
He previously mentioned that Ethereum’s on-chain economies and network effects will send it much higher than it is now. He thinks that because much of the public hasn’t heard about Ethereum, they will invest heavily in the coin during this market cycle:
“Meanwhile, to the mainstream $ETH will be the new kid on the block — expect a frenzy to go with that realization. Given $ETH’s outperformance of $BTC over its lifetime (chart below again), not to mention smaller network value and strong on-chain economies, I see every reason for $ETHBTC to surpass ATHs.”
— Chris Burniske (@cburniske) August 9, 2020
“The driving takeaway here is that in order for a decentralized smart contract platform with a native, permissionless, trustless asset to successfully provide the world with a permissionless, trustless economy, it will require its native asset to supply trillions in economic bandwidth.”
DeFi is facing some barriers to growth, though, like high transaction fees and the high block times relative to traditional financial latency. Some think that these barriers may actually be enough to put a hard cap on the DeFi rally as certain financial applications and many users may be excluded from the DeFi phenomenon.
Featured Image from Shutterstock Price tags: ethusd, ethbtc Charts from TradingView.com Why An Analyst Isn't Convinced of Ethereum's Price Action Despite Rally to $375