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Ethereum (ETH) is gradually approaching a significant level, with Wall Street analyst Tom Lee suggesting the cryptocurrency will bottom out around the $4,300 mark within hours.
According to Tom Lee, this level will provide significant support, paving the way for a possible rally. The forecast is aligned with BitMine's substantial purchase of 4,781 ETH, which suggests a bullish outlook on Ethereum's future price trajectory.
BitMine, the largest corporate holder of Ethereum, recently acquired a massive 4,781 ETH worth $21.3 million. This raises its total ETH holdings to about 1.72 million tokens, or about 1.42% of the total circulating supply. The purchase reflects the increasing institutional interest in Ethereum, particularly as its price approaches the $4,300 level.
Market analysts interpret BitMine's move as a bullish indicator. The purchase time and the predictions posed by Tom Lee indicate that there is a chance that Ethereum will rise after a short decline. It may also be a sign that institutional investors are anticipating Ethereum will bounce back at this critical support level.
Fundstrat's Tom Lee has echoed the sentiment that Ethereum is due for a rebound. Lee cites insights from Mark Newton, a managing director of Fundstrat, who believes Ethereum will drop to a relatively low level of $4,300 within 12 hours.
Newton believes that after this pullback, Ethereum may once again achieve new highs, potentially reaching $5,100 to $5,450.
The analysis is supported by technical considerations, with Ethereum trading above the 61.8% retracement point of support at $4,407. This area is often crucial for potential price reversals.
Lee's prediction matches the performance of the broader market, with Ethereum currently testing major support values after unwinding from a high of $4,800. In case the price holds, there might be a short-term relief rally toward $4,491 to $4,550; however, the RSI indicates that there might be downside pressure in the short term.
On-chain indicators suggest that Ethereum may experience additional upside in the long term. Analysts have observed that cryptocurrency was at the stage of belief in its market cycle, as shown by the Long-Term Holder (LTH) Net Unrealized Profit/Loss (NUPL) indicator. This phase is usually followed by significant price surges, indicating a future long-term growth period in Ethereum.
Furthermore, the Market Value to Realized Value (MVRV) ratio shows that Ethereum is still undervalued and has the potential to record new gains. Other analysts even foresee Ethereum reaching prices up to as much as $10,000 to $20,000, especially as it secures more institutional investors and is met with a macroeconomic environment that features a reduction of interest rates.
Also Read: Ethereum Price Prediction: ETH Reaches New All-Time Highs Of $4,950, What's Next?
