Despite the recent positive momentum in the broader cryptocurrency market, Ethereum (ETH) might be struggling to revisit the psychological threshold of $2,000. However, the outlook may not be bearish according to the rainbow price chart indicator for Ethereum provided by BlockchainCenter.
What Will Happen to Ethereum Price
Particularly, some crypto traders and investors use Ethereum’s rainbow chart to observe the historical movements of the second-largest cryptocurrency by market value based on various moving averages (MAs), finding patterns that could assist them in making better investment decisions.
According to data seen on June 23, this chart shows that Ethereum is still in the ‘fire sale’ stage represented in purple, fluctuating between $0 and $2,593, below the ‘Undervalued’ blue zone of $2,593 to $3,668.
Specifically, Ethereum has been stuck in the ‘fire sale’ zone since the start of October 2022 and based on its previous behavior, ETH might exit this zone within a few weeks, as it did in July 2020 when it moved into the ‘Undervalued’ zone after an eight-month stay in the ‘Fire Sale’ zone.
Further digging into the figures, it took ten months for Ethereum to reach the “Did we deserve this?” level at $4,336. If the same trend repeats, the crypto asset might end up in the same zone, which currently lies between $16,353 and $23,742, by April 2024.
Ethereum Price Analysis
In other words, by around January 1, 2024, Ethereum might be trading in the ‘Still cheap’ price zone of the rainbow chart; this price zone could be between $5,290 and $7,705.
Before this move, Ethereum was only once in the ‘fire sale’ zone, in October 2015, and four months later it rose to the ‘Should we return to BTC?’ price level, then fell to the ‘Undervalued’ zone in January 2017, where it stayed for a very short time before climbing beyond the ‘Maximum Bubble Territory’.
If this pattern repeats, Ethereum could surge to a price between $23,742 and $34,283 in the “Should we return to BTC?” zone by October 2023, and it could fall back to the “Undervalued” zone between $2,593 and $3,668 by January 2024.
Meanwhile, at the time of writing, Ethereum was trading at $1,907, recording a 1.31% increase within the day, and according to the latest data, it registered a 12.48% increase over the previous week and a 3.21% gain on its monthly chart.
All things considered, whether Ethereum will move in one of the two rainbow chart patterns will depend on further developments surrounding the Ethereum network, as well as the overall sentiment on the broader crypto and macroeconomic landscape.
