• A timely ETH 2.0 launch will become a strong bullish catalyst for Ethereum price.
  • On-chain metrics support the short-term bullish thesis.

At the time of writing, Ethereum price is trading at $475. The second-largest cryptocurrency by market capitalization stopped short of $500 on Wednesday, November 18, as the upside momentum started fading away across the board. However, several fundamental factors and on-chain metrics imply that ETH is poised for substantial long-term growth.

Ethereum 2.0 is looming large

The cryptocurrency community is waiting for the launch of the second version of the Ethereum protocol, also known as Serenity. The experts believe this event may become a major milestone for the whole cryptocurrency industry as it will transform the ecosystem of one of the most used tokens. It is expected to make the network more stable, secure, and scalable. 

The launch is scheduled for December 1. However, the actual date will depend on whether the project secures at least 524,288 ETH at its dedicated deposit smart contract. While the team managed to secure only 19% of the required amount, there is little doubt that the update will be launched.

As FXStreet recently reported, Ethereum's co-founder Vitalik Buterin vowed to do everything to meet the deadline, and if he sticks to his promise, prices may get a powerful boost.

On-chain metrics support the bullish case

Exchange inflow has been decreasing recently, meaning that traders are less inclined to sell their coins.

This metric shows the number of ETH sent to large trading platforms on a daily basis. Sudden spikes in this metric are usually accompanied by increased downward pressure, but there current low levels suggest that there is nothing to worry about.

Ethereum's exchange inflows

Ethereum's Exchange Inflows

Additionally, the network continues growing in sync with Ethereum price, which is typically a positive sign. A growing number of new addresses joining the network has usually lead to upward price action. 

Ethereum's network growth

Ethereum's Network Growth

Ethereum price forecast

It is worth mentioning that this altcoin sits on top of significant support, based on IntoTheBlock's "In/Out of the Money Around Price" model. The IOMAP cohorts show that over 1.2 million addresses had previously purchased 10.3 million ETH between $460 and $473. 

Such a significant supply wall can absorb any bearish pressure. If so, a potential rebound from this demand wall may even send Ethereum price above $500. The IOMAP cohorts show there are no considerable resistance barriers ahead.

Once $500 is sustainably cleared, the upside momentum will likely gain traction and take the smart contracts giant towards $700 or $900. 

ETH In/Out of the Money Around Price

ETH In/Out of the Money Around Price

Due to the unpredictability of the cryptocurrency market, the bearish outlook cannot be disregarded. 

If the Ethereum Foundation misses the deadline for ETH 2.0's launch, selling pressure could spike up. Under such circumstances, a move below the $460 support level will invalidate the bullish scenario. Investors might even panic sell pushing prices down to the next crucial support at $400.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

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