Ethereum is not only the second-biggest cryptocurrency in the world, it is also one of the most significant social coins given its demand amongst the people. For that coin, $3k has been time and again tested level, which is crucial in determining the trend of the price action going forward.
Ethereum back at $3,000
$3,000 and $2,321, these two levels have been important in the history of ETH because, since May 2021, the king of the altcoin has sometimes tested them both as resistance and as support. While for most of the second half of 2021 ETH remained above $3,000, it tipped it into resistance in early 2022.
And after multiple retest as resistance, ETH might be heading back to close above it since more than just the price, a lot more is riding on this occurrence.
On March 25, Ethereum will face a major expiry with 772,700 contracts set to close. Of these, around 580,000 contracts are looking for a bullish close with significant demand for a close at or above $3,000.
For Ethereum reaching $3k does seem like a possibility in the next 48 hours. The probability for the same is above 37%, which is significantly better than most targets set towards the end of the month. Plus, with ETH trading at $2,956, it only needs a 1.82% rally to do so.
It already has support from price indicators, notably the 50-day SMA, which it recovered four days ago. (ref. Ethereum Price Action image)
But the Implied Volatility – Realized Volatility spread might be a concern as it is indicating a bearish sentiment across the board. That could lead to ETH not closing above $3k and then falling back below it before 25 March.
Moreover, moving back above $3,000 would also be a major incentive for investors who have been holding off since January, expecting a solid recovery. Most of their sudden spike in activity was seen around $3,000 test instances.
Although the overall transactions on the network have reduced, they are still keeping above the 1 million mark, which is the only thing Ethereum has retained since the May crash of 2021.
