ETHUSD breaking out of 2,460–2,750 range to mark new phase of growth

After a strong growth momentum in early May, Ethereum switched to sideways trading. The price has stabilized in the range of 2,460 to 2,750, and the longer it is within the range, the stronger the move may be when one of the boundaries is broken through. From a fundamental point of view, the crypto market is on the rise. The technical picture does not prevent further growth of ETHUSD either. This makes testing 2,750 from below upwards the most likely scenario.

According to FXStreet, US Ethereum-backed exchange traded funds (ETF) have seen inflows for almost two consecutive weeks. Over that time, market participants boosted their investments by more than $750 million. The direct trade situation also favors higher prices, as Ethereum exchange reserves dropped to an all-time low of 18.65 million coins. Those looking to buy the cryptocurrency may face a supply shortage, which pushes prices up. 

Besides, Coinotag reports that large companies, such as BlackRock and Fidelity, are rebalancing their investment portfolios. They have cut their bitcoin investment by $180 million, while increasing the long position on Ethereum by $78 million. The world’s major cryptocurrency is extremely close to an all-time high, and ETHUSD has nearly 90% of the way ahead of it before the pair could reach a similar mark. From this perspective, the growth potential of Ethereum looks much more attractive.

Coinotag analysts forecast that Ethereum could head towards the level of $3,000 after breaking out of the current sideways trend. They believe inflows from traditional financial institutions into ETFs give this cryptocurrency a higher profile and attract conservative investors from other financial market segments. This accumulation of coins could lower volatility, which is also favored by cautious traders.

The Stochastic indicator on the daily chart signals buying, which boosts the chances of a successful breakout to the level of 2,750. 

Consider the following trading strategy:

Buy ETHUSD at the current price. Take profit – 2,750. Stop loss – 2,460.