Nick Forster, founder of Derive, outlines three crucial factors for Ether to break its all-time high: Trump’s victory in the 2024 U.S. election, aggressive Federal Reserve rate cuts, and a rise in global liquidity.
Ethereum (ETH), the second-largest cryptocurrency, is not showing any sign of reaching the new all-time high mark by the end of 2024. While some analysts believe it’s possible, current market conditions and competition from tech stocks do not favor Ether’s surpassing its previous peak.
Photo: CoinMarketCap
Since the beginning of 2024, Ethereum has not shown any significant price momentum. As of September 6th, ETH is trading at $2,352, marking a 3% increase compared to the start of the year. In contrast, tech stocks like Nvidia and Meta Platforms have significantly outperformed, with Nvidia soaring 122% and Meta gaining 50%.
Ether Faces Stiff Competition
Despite these figures, some traders remain bullish, arguing that a price spike for Ether is imminent. Nick Forster, founder of the derivatives platform Derive, pointed out that Ethereum is currently struggling to develop a strong narrative to drive its price, unlike tech stocks delivering strong returns.
“Right now, Ethereum is struggling with a lack of a strong narrative to drive its price, especially compared to other assets,” Forster remarked.
The July 23 launch of Ether-based exchange-traded funds (ETFs) garnered more Wall Street attention but placed Ether in direct competition with tech stocks. Although the ETFs drew interest, the returns so far have not been as lucrative.
For Ether to break its all-time high of $4,891, Forster highlights three key events that would need to align: Donald Trump winning the 2024 US presidential election, aggressive rate cuts by the Federal Reserve, and an increase in global liquidity. Even with these events, options markets are giving Ether only a 10% chance of reaching such heights by the end of the year.
Other traders are less optimistic. Zen, a crypto trader, warned that Federal Reserve rate cuts might lead to a bearish market if they fall short of expectations. He emphasized that a 50 basis points cut is being rumored, and the market is adjusting prices accordingly. A smaller 25 basis points cut could turn into negative news, leading to downward price pressure.
#Ethereum reached dip buy zone I've marked about 2 weeks ago. There was an option with long above 2800, but price action shown that $ETH is not ready. And it went down fast together with the rest of the market.
— Zen (@WiseAnalyze) September 4, 2024
Now not that clear. Feels like price will grow higher, but to… pic.twitter.com/3l70ijMWhM
US Election Impact on Ethereum
The upcoming US election could add another layer of volatility for Ethereum. According to Forster, the election alone may become “the most significant event in Ethereum’s history,” even more than the spot ETFs. Traders anticipate large price swings, with Ethereum’s daily price movements potentially increasing from 2.5–3% to 3.5%.
Amid these predictions, some traders remain confident about a potential price rise. Titan of Crypto, a pseudonymous trader, noted that Ethereum’s relative strength index (RSI) is approaching oversold territory, which often leads to either a rally or a short-term price pump.
While the outlook for Ether breaking its all-time high in 2024 is uncertain, key financial and geopolitical events may shift market dynamics, sparking volatility in the coming months.
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