Ethereum is currently consolidating in a bullish formation at $445 following a remarkable 19.82% move to the upside over the past week.
The world’s second largest cryptocurrency by market cap is trading above the $446 level of support, which is notable as this was a point of resistance back in August.
The fact that Ethereum is establishing a level of support within striking distance of its yearly high is telling, as it indicates that continuation to the upside is on the cards in the coming weeks.
However, recent news is poised to make a rather important impact on crypto assets, with developments of a covid-19 vaccine causing a surge in global stock markets and a plunge in the price of gold.
Cryptocurrencies are often touted as being a safe haven investment that is designed to be a hedge against the traditional financial system.
As the economy eventually recovers, safe haven assets like Bitcoin, Ethereum and gold will struggle as investors will switch attention back to the stock market.
It’s worth noting that while Bitcoin is compared to gold, it has actually shown positive correlation with the S&P500 this year, which means that crypto may be in store for a positive end to what has been a volatile year.
From a short-term perspective, Ethereum needs to break above $466 to demonstrate a period of bullish continuation while holding firm above the $446 level of support.
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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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