When will Ethereum reach 5K?
After taking a look at the ETH/USD price action, I'm convinced it's only a matter of time before Ethereum reaches 5K.
It’s not a matter of if, but when will Ethereum reach 5K.
With price continuing to make new all-time highs, we’re now seeing traders watching psychological levels such as this one, like a hawk.
This updated blog takes a look at why psychological levels such as Ethereum’s 5K are significant and then takes an updated look at the ETH/USD price action as 2021 comes to a close.
The Significance of Psychological Levels like Ethereum’s 5K
Psychological levels, otherwise known simply as round numbers in price, frequently act as support/resistance.
As you’ll see on each of the charts within this blog post, Ethereum has ripped through almost every psychological round number with significant momentum.
We’ve previously spoken about Ethereum ripping through 3K and after recently breaking 4K, it’s now only a matter of time before 5K is also checked off.
Psychological numbers, such as the 5K price target in Ethereum, are important because human beings like having the ability to relate.
Without any other previous turning points for price, round numbers are an easy target for the human brain to scatter orders around.
As a result, the price action surrounding these psychological 00 levels becomes highly watched and significant.
Think of psychological levels as somewhat of a self-fulfilling prophecy.
They’re significant because people think they’re significant, which ensures they are significant.
Ethereum’s March to 5K
With that little support/resistance psychology lesson in the books, let’s now take a look at Ethereum’s march to 5K from a technical analysis perspective.
As always when talking about technicals on this blog, we start with a look at a higher time frame chart.
We always start with the higher time frame charts because the further you zoom out, the more data you have to draw from and this makes the patterns much more significant.
The shorter time frame charts have a place, but only if the setups there align with the higher time frame price action.
In this case, we will start by taking a look at the updated Ethereum daily chart.
Ethereum (ETH/USD) Daily:
With the Ethereum price continuing to create new all-time highs at what feels like every second week, you can see on the above charts that psychological round numbers have been respected all the way up.
2K, 3K, 4K and inevitable when Ethereum reaches 5K we’re going to see the same.
What I love about the price action on that daily chart, is the way that the bulls reclaimed the 4K level almost immediately after it was lost.
In a bull market this strong, FUD such as Tesla no longer accepting BTC from customers to buy cars (lol, seriously who cares), never lasts long.
The chart shows us that this case was no different and the bulls used it as a simple dip buying opportunity before launching their next assault on 5K.
Ethereum Making Another Push to 5K - November 21 update
Let’s now zoom into an Ethereum hourly chart and take a look at the intraday price action.
It’s on the intraday charts where you can more closely follow the price action around the daily zones, giving you a more refined entry or exit on your trades.
Ethereum (ETH/USD) Hourly:
You can see that today’s pullback came immediately after printing a fresh new all-time high.
A perfect fake-out scenario where the stops of eager retail traders were likely triggered in order for the smart money to accumulate a larger position
In my personal opinion, price is still a little too far from the 5K higher time frame zone for me to be trading these intraday moves, but the price action is interesting nonetheless.
These large intraday candles are showing that both the bulls and bears are getting nervous up here, signalling something big is just around the corner.
Could this be a pre-curser to the inevitable Ethereum 5K breakout?
Final Thoughts on ETH to 5K
I want to wrap things up with the same sentiment that I started this blog with.
That it’s not a matter of if, but when for Ethereum to reach 5K.
The lure of the psychological zone is likely going to be too much to resist, with a ton of liquidity in the form of stops lurking on either side.
A target that will act like a magnet for Ethereum bulls and bears alike to fill their long term bags in either direction.
Before I publish this update, I wanted to once again share our constantly evolving Ethereum guide.
If you’re looking to learn about Ethereum from both a technical and trading point of view, then this guide is your one stop shop.
Best of probabilities to you.
Direct from the desk of Dane Williams.
Why not share a chart or leave a comment with your opinion on when Ethereum will reach 5K? All comments that add something to the discussion will be upvoted.
This Ethereum market analysis blog is exclusive to leofinance.io.
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