Ethereum broke out on Friday, breaking above the $500 level and closing the day near the highs around $510, ending the week on an extremely bullish note. Ethereum formed an impulsive bullish candle, breaking through resistance at $500 and closing the day above it, which should lead to a green open on Monday in Asia.
(November 20, 2020 9:30PM EST)
Outlook: Ethereum finally broke out on Friday, rising above the $500 level on bullish commentary from traditional financial firms and supply/demand analysis. If ETH can hold $500 next week, ETH will likely confirm a bull market and look toward new yearly highs closer to the four-figure mark. If ETH falls back below $500, look for a retracement to the $400 or $450 levels, which provide great value. Even at $500, ETH is a strong buy and excellent value relative to Bitcoin which is nearing the end of the run I expect ETH to have possibly just initiated.
We are approaching the end of the month, and the first week of December is when ETH 2.0’s beacon chain is scheduled to launch IF the deposit contract’s 500k+ staked ETH threshold is satisfied. So far, only roughly 100k ETH has been staked to this contract, however seeing as how there are no incentives to staking earlier as yields will not be distributed until after a 2-year lockup, investors will most likely wait until just before the deadline to deposit their ETH to initiate the launch. If the threshold is not met by the date, the same deadline will be pushed back a short time.
Support: Look for support at $450, which is above the major $400 inflection point and a price level ETH spent quite a bit of time consolidation around. Below that, look for support around the $400 level as the 50 Day EMA is now trading at $411 and rising.
Resistance: We may finally have our breakout above $500, so I’m looking for a sustained move up from here, or consolidation around $450-$500 to confirm new higher support. After that, expect moves in $50-$100 increments. I think the upper range of this move is somewhere between $600-700 but it wouldn't be surprising to see a wick higher before an EWT retracement.
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