In just one month, the Ethereum price has risen from $83 to $150, an 80% bounce off the yearly lows. Therefore today, January 2nd, following a 7% increase in its price, Ethereum (ETH) surpassed Ripple (XRP) to reclaim its throne as the second most valuable cryptocurrency by market cap.
Many crypto commentators and market analysts believe there are two main factors that have created this surge in the price of Ethereum in the past month: the upcoming Constantinople fork and of course an extremely oversold market.
Alex Krüger, an economist and a cryptocurrency trader, believes the the upcoming fork of Ethereum called Constantinople is increasing the demand for Ethereum, as the fork would reduce the block rewards of ETH from 3 to 2. He also notes the delay of BAKKT may be moving demand away from BTC towards ETH.
From early November to mid-December, Ethereum experienced a steep decline in value as its price fell from $220 to $83. Despite its recent 80 percent climb, the asset is yet to achieve November levels and would still have to increase by an additional 46 percent to rise back to $220.
ETH remains as one of the best-performing assets in December 2018, outperforming Bitcoin, Ripple, and Bitcoin Cash. However, the valuation of the cryptocurrency market still remains at $130 billion and it is far from recovering to previous highs and as such, it is still too early to conclude that ETH has started to enter a mid-term bull rally. The daily candle closed above the Range High so therefore the resistance at $162 – $170 is the area of greatest interest.