September has been a tough month for crypto investors, especially those betting big on Ether as it has fallen over 13%. Nevertheless, such a pullback wasn’t out of the ordinary.
In fact, at the time of going to press, ETH has recovered significantly from its losses, with altcoin trading at $ 3,387.
Needless to say, such volatility has fueled speculations about where the altcoin will be in the months to come.
How does Q4 find ETH?
In a recent report for Bloomberg Intelligence, senior commodities strategist Mike McGlone presented his analysis of what to expect. In doing so, the analyst compared ETH to its closest rival on the market cap charts – Bitcoin. Using a host of different metrics to back up his claim, McGlone argued that he was quite bullish on ETH in Q4.
According to McGlone, Ethereum has major price tailwinds in the non-fungible token (NFT), fintech, stablecoins, and decentralized finance (DeFi) space to support its rally. Against this backdrop, the price of ETH is still in its early days of price discovery and could show further price appreciation.
Moreover, he argued that EIP-1559 execution has added a new bullish aspect to ETH’s price trajectory.
“Demand and adoption are rising, but our graphic depicts a notable difference from a year ago — plunging supply. At the start of Q4 2020, the 12-month rate of change in Mosaic’s Ethereum supply measure was closer to 5%. Now it’s on track to drop toward 2% because of a recent upgrade.”
Put simply, the analyst believes that in the future we may see a consolidation of the bull market narrative for Ethereum.
ETH vs BTC – The war continues…
These two cryptos have been facing off against each other for a long time now. Now, while BTC has dominated the crypto roost so far, is there a turnaround on the horizon?
Well, some would say most certainly.
The digitization of money and finance, coupled with ETH use cases, has helped it attract major players. Also, it has been taking a major chunk of the market share, when compared to its direct competitors.
Consider the attached table, for example. The second largest cryptocurrency by market cap is starting to shine in recent times.
In the DeFi sector, growth has been exponential, with the total value locked (TVL) of these assets reaching $100 billion versus the $20 billion recorded in 2020. The report noted,
“Data from Mosaic and Coin Dance puts Ethereum at the top of the food chain, indicating the rise in crypto stocks and its importance as a go-to platform for smart contracts, NFTs, and decentralized finance.”
Curiously, the report also claimed that Ethereum was overextended above $4,000 in May. Right now, however, it seems to be on more solid footing around $ 3,300.
As covered previously, ETH is favored to climb above $3,500 and test some benchmarks in the coming days. McGlone went on to say,
“With ETH indicators now shifting to a bullish position, expect ETH to break through its 50% and 61.8% Fibonacci extension levels with relative ease and establish a new ATH close to $ 5,000. “
Having said that, CoinShares’ insights had a slightly different narrative for the flagship crypto. Despite a week of fundraising, it recorded a drop of around 3% in market share. Needless to say, it will be a few more weeks before we get more clarity.
