- Ethereum price struggles to hold above the initial support at $340.
- ETH/USD run-up to $400 unlikely to come easy; tough resistance envisaged between $390 and $400.
The smart contract giant network continues to struggle amid surging gas fees, a situation that is putting Ethereum developers into the spotlight as the community presses for solutions. For this reason, the developers are reportedly looking at older methods that could help mitigate the ever-growing challenge of high transaction fees. One of these methods is gas tokens. It is described as smart contract loopholes because if integrated, it could support the sending of transactions at a lower cost by virtually “tokenizing” gas.
Gas is the fee that network users pay to send transactions and run other on-chain programs. The method allows the user to buy the gas fees when they are lower and store them for use later. Although gas tokens can help solve the problem at hand, some developers argue that they are not viable in the long term as they can act as a “price floor,” in turn, holding the price at an eternal high.
Ethereum market update
Ether is teetering at $345 in the wake of a 2.31% loss on Tuesday, September 8. From an opening value of $353.71, the cryptoasset extended the bearish leg to $344.30 (intraday low). On the upside, an intraday high of $357.01 limited the bullish effort, preventing ETH from testing the resistance at $360.
ETH/USD 1-hour chart
At the time of writing, the bulls' biggest headache is holding Ethereum above the short term support at $340. The second-largest cryptoasset must hold above this zone, at least for now, because a break below it could open the Pandora box and push Ethereum into the primary support range ($310 - $320).
Ethereum technical analysis
Ethereum is gradually entering into another bullish phase according to the various technical indicators applied to the 4-hour chart. For instance, the Moving Average Convergence Divergence (MACD) is sustaining recovery towards the positive region. The MACD fell to levels below -20 but currently holds the ground at -16.03. Note that this is a lagging indicator; hence it may not reflect the immediate price action. However, the bullish divergence above highlights that buying activities are present.
Subsequently, the Relative Strength Index (RSI) currently highlights the breakdown from the intraday high at $357 to the overall market value at $345. In other words, short term analysis shows that Ether’s path of least resistance is downwards. The possible death-cross pattern reflects the same as the 50 Simple Moving Average (SMA) crosses below the longer-term 100 SMA.
ETH/USD 4-hour chart
Intriguingly, the Bollinger Bands are beginning to contract, therefore, highlighting a decrease in volatility or even possible consolidation. If the price moves above the Bollinger Bands middle curve, the move past $360 will come relatively easy. The approach to $400 could continue to lag, especially if the technical levels remain unaltered. It is essential to keep in mind the seller congestion between $390 and $400.
Ethereum on-chain analysis
IntoTheBlock, a well-known analysis platform, provides critical on-chain data that investors can capitalize on to profit. According to the In/Out of the Money metric, the zone between $345.21 and $354.60 is the first resistance zone. The volume of Ether bought in this range is 870,020. If the price grows to surpass the range limit, Ethereum will be treated to intense support, paving the way for an upswing above the resistance at $365. Ethereum's run-up to $400 will not be a walk in the park because of the addresses currently out of the money ranges; $376.06 - $386.79 and $386.79 - $397.53.
Regarding the current Ethereum price, a drop under $345 would most-likely retest support at $330. The 2.55 ETH bought in this zone is would not give the bears an easy pass. Besides, the next support at $325 is not as strong; hence the possibility of ETH plunging the zone at $314 and $300, respectively.
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