ETH price analysis
After many concerns about the damages that cryptocurrencies can create to the environment, in early 2020, the Ethereum developers decided that security for the base layer of the Ethereum protocol would be better changed from Proof-of-Work (mining) to Proof-of-Stake (PoS). The biggest problem that blockchain can cause is climate change, and now while we are still waiting for updates, many believe that these changes in the ETH system can save not only the ETH, it can save the blockchain in the bigger picture.
While there are many optimists about this update and the opportunities that it can create, many others have different concerns. One of the frequently asked questions is: What if it does not work? The current system is working fine, and everything is OK. Since everything in the new system depends on its ecosystem and how users take care of the community, so if that player is big enough, it could derail the merge. It means that even if the merge itself could go flawlessly, the system can be derailed later by a prominent ecosystem player having issues.
From the technical point of view, as we can see in the below figure, ETH, after a long-run downtrend, had a correction. However, this correction was not strong enough to take the price above 2,000 USD, and it lost ground as soon as it touched this psychological level. Still, ETH’s primary resistance sits at 2,400, and critical support is set at $1,200. As long as it trades between these levels, none of the bulls or bears have enough power to avoid the side movement. Any uptrend or downtrend starts above or under mentioned prices. For now, the price mainly depends on overall market sentiment, which leads by FED decisions.