Experts say the $ 5,000 price for ETH has been “programmed” since 2018, and some have even gone so far as to predict a price of $ 20,000 in the long term.

“5,000 US dollars for programmed ETH”.

Part of the reason for the words Demand price increase This is based on ETH 2.0 staking and deflation due to EIP-1559.

“At this point in 2017, Bitcoin is around $ 2,000. Just 7 months later, it’s nearly $ 20,000. What do you think will happen if the world wakes up in less than 2 months to the APR (annual percentage) and the deflationary aspect of the introduction of ETH? I think $ 20,000 is programmed. “

The estimate of $ 20,000 equates to a market cap of $ 2,360 billion, and even if it were doable, it still looks too optimistic right now.

Ether has been entering an ascending channel since September 20th, which means $ 5,000 will become support by the end of November.

Ether price chart | Source: TradingView

The latest strength has been aided by the growth in Adjusted Net Worth (TVL) in the Ethereum network’s smart contracts. TVL measures assets deposited on dApps and is typically guided by credit logs and DEX exchanges.

Total value locked in the Ethereum network | Source: DeBank.com

Ethers TVL broke its all-time high (ATH) of $ 71 billion on October 16, up 50% in the three months ended October 31.

Negative regulatory headwinds from US lawmakers could deter investors from cryptocurrencies. Many US states, including Kentucky, Texas, Alabama, Vermont, New Jersey, and most recently New York, have started restricting crypto lending.

In addition, the New York-based decentralized forecasting market Polymarket was examined by the US Commodity Futures Trading Commission (CFTC) in October. follow report From Bloomberg on October 23, the agency is looking into whether DeFi will allow its clients to trade binary options and swaps without the required regulatory approval.

On the other hand, some investors expect that the positive development of the traditional markets will continue to drive the upward momentum. The data shows that November was the best month for the S&P 500 since 1985.

Professional traders believe that the price of ether will go up

To confirm investor confidence in the $ 5,000 prophecy, people should keep an eye on the monthly premium of the contract known as the “base”. In contrast to perpetual futures, these fixed-term futures contracts do not have a financing rate, so their prices differ greatly from the regular spot exchanges.

By measuring the difference in cost between the futures contract and the regular spot market, a trader can gauge how optimistic the market is. If buyers are overly optimistic, the three-month futures contract will trade at an annual premium of 15% or more (base).

3 months term of the basic rate | Source: Laevitas.ch

Note that even the 9.5% correction from $ 4,300 to $ 3,900 in Ether on October 27th was not enough to break the morale of these traders. The base is currently 17%, which indicates a moderate upward trend.

The options market shows a moderate upward trend

Ether hit an ATH at $ 4,460 on October 29, and to see how bullish traders are we need to look at a 25% delta deviation. This indicator provides a reliable analysis of “fear and greed” by comparing similar call and put options.

The index becomes positive if the neutral to bearish put option premium is higher than that of calls with similar risk. This situation is often referred to as the “fear” scenario. On the other hand, a negative deviation means that protection costs will rise higher and indicate a bullish trend.

Ethers 60 day delta option 25% offset allocation | Source: laevitas.ch

The above chart shows the indicator at minus 9, approaching the “greedy” momentum area. This bullish stance started on October 18th, which is not a positive day for Ether as the USD 3,700 support has been tested multiple times.

Both indicators on the derivatives market are on the edge of the neutral to bullish range, which is to be interpreted as very positive, as it leaves the buyers room to leverage derivatives with the help of derivatives.

According to the futures and options numbers, the bulls’ call for $ 5,000 might be right in the short term.

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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

Teacher

According to Cointelegraph

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