Ethereum Price Forecast As DeFi TVL Jumps To $57B, ETH Poised For $4,000 This Week?
Ethereum price forecast: ETH is nearing its highest level in a little over a week in tandem with a strong crypto rebound from last week’s bottom. Bitcoin, the largest cryptocurrency, upholds the bullish outlook closing in on the $65,000 mark.
Leading altcoins like Binance Coin (BNB), Solana (SOL) and XRP are also in the green, rewarding patient investors. Nevertheless, market doldrums cannot be ignored, especially in light of the many internal and internal factors in play.
Externally, skyrocketing inflation is a hindrance to risk asset classes like crypto. Recently the Federal Reserve left interest rates unchanged amid persistent inflation in the US since January.
The outlook for the first rate cut in the year has shifted as the Fed battles to bring inflation to 2%. Experts project that the first-rate cut may come late in the year as opposed to June.
The current Ethereum price forecast shows the leading smart contracts token hovering at $3,122 on Monday, down a modest 0.5% in 24 hours. Ranking #2 in the market, Ether boasts $374 billion — a value backed by $10 billion of trading volume.
Ethereum Price Forecast: Does DeFi TVL Impact ETH Technical Outlook?
According to data processed and graphically presented by DeFi Llama, the cumulative value of all the assets locked in smart contracts within the ecosystem is back on the move, rising to $57 billion. Although this figure is a pale shadow of the $109 billion record high, persistent increases reduce potential selling pressure.
Investors show confidence in the long-term value of a coin by staking their holdings to grow their wallets. Staking rewards are distributed daily on an annualized basis, allowing the community to participate in processing transactions and securing the network.
A high total value locked (TVL) reduces the circulating supply and subsequently, the potential selling pressure. Sentiment also improves encouraging more people to buy ETH, thus propping the token for gains.
Can Ethereum Rally To $4,000 In May
Investors are holding firmly to their positions as the crypto market rebounds in May. April broke several months of a bullish streak ignited in Q4 last year. With major cryptocurrencies waking up strongly this week, aiming for higher levels this week and a rally to $4,000 before the end of May.
The bullish bet on Ethereum price hinges on the falling wedge seen on the daily chart. Although a bullish pattern, it remains unconfirmed until the price breaks above the upper trendline.
Traders activate their buy orders following this breakout and anticipate a move equal to the distance between the widest points of the wedge — roughly 25%.
On the sell side, traders cannot ignore the position of the Relative Strength Index (RSI) at 46. A careful examination reveals the indicator stuck below the trend line resistance. Should this trend continue, selling pressure will be a ticking bomb.
Ethereum price also sits below two bull market indicators; the 20-day Exponential Moving Average (EMA) and the 50-day EMA. Bulls must reclaim these two key levels to validate their strong grip on the uptrend.
Otherwise, there’s a glaring possibility of another sweep at the $3,000 and $2,800 support areas to collect more liquidity.
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