Ethereum is moving into the typically low volume weekend having bounced from the four-hour 200 exponential moving average.
Despite momentarily selling off to $361, Ethereum immediately recovered with a 2.01% surge to the upside on Friday morning.
The bounce off the 200 EMA comes four days after a four-hour golden cross, which indicates a transition into a short-term bullish phase.
However, $389.55 remains a key level of resistance and until that is broken Ethereum remains in a relatively tight trading range with $366.65 being a notable level of support.
Much of Ethereum’s upcoming price action will depend on the trajectory of two variables; the rise in popularity of DeFi and the increased institutional flow into Bitcoin.
DeFi has shown signs of serious strength and innovation throughout 2020, with yield farming tokens like Yearn Finance (YFI) and C.vault Finance (CORE) rallying exponentially as users attempt to lock in high annual percentage yields (APYs).
As most of DeFi protocols are based on Ethereum, continuation to the upside for the DeFi sector would have a subsequently positive impact on the price of Ethereum itself.
Bitcoin, meanwhile, has reinforced its reputation as the leading cryptocurrency over the past two months with institutional investment flowing in from the likes of Square and MicroStrategy, which could well give the entire asset class a significant boost.
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Ethereum was launched by Vitalik Buterin on July 30 2015. He was a researcher and programmer working on Bitcoin Magazine and he initially wrote a whitepaper in 2013 describing Ethereum.
Buterin had proposed that Bitcoin needed a scripting language. He decided to develop a new platform with a more general scripting language when he couldn’t get buy-in to his proposal.
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