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Ethereum

Analyst Predicts Monster Uptrends for Ethereum and Aave, Says Red-Hot Solana Could Run Hard

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A popular crypto strategist and trader is predicting strong uptrends for Ethereum (ETH) while saying that explosive altcoin Solana (SOL) could continue its impressive performance.

The pseudonymous trader Smart Contracter tells his 176,000 Twitter followers that he’s keeping a close watch on Ethereum against Bitcoin (ETH/BTC) because he believes the trading pair remains bullish after it broke out from a large inverse head and shoulders pattern (IHS).

“ETH/BTC is still huge IHS breakout after a three-year base. It may have been somewhat boring the last few months but make no mistake about it, this is re-accumulation in a monster uptrend.”

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Source: Smart Contracter/Twitter

An inverse head and shoulders pattern is a bullish technical pattern that marks the beginning of a new uptrend. According to Smart Contracter’s chart, ETH/BTC is currently consolidating within a bullish continuation pattern and can climb as high as 0.12 BTC, worth $7,287 at time of writing.

Next looking at the leading smart contract platform against the US dollar, the crypto strategist says ETH is now en route to $5,000 after it took out a diagonal resistance.

“I think today is the day we get a proper $ETH [all-time high] breakout.”

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Source: Smart Contracter/Twitter

Next is lending and borrowing protocol Aave (AAVE), which the trader believes is ready to ignite an epic rally after printing a bullish higher low setup.

“Aave putting in a solid weekly higher low here. With blue chips like CRV already moving, I’m going to assume other blue chips have bottomed and are not far behind. [Decentralized finance season] is near and Aave is an old favorite of mine.”

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Source: Smart Contracter/Twitter

The trader uses the Elliott Wave theory, a technical analysis approach that predicts future price action by following the psychology of market participants that tends to manifest in waves. According to Smart Contracter’s chart, AAVE can soar close to $900 before completing its five-wave cycle.

As for Ethereum competitor Solana, Smart Contracter predicts a strong rally for the red-hot altcoin after it breached two diagonal resistances on the 12-hour chart.

“Got SOL low key breaking downtrends of two different degrees. This bad boy runs hard when it gets going and it’s only just getting started here.”

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Source: Smart Contracter/Twitter

In the short term, the crypto strategist predicts that Solana can revisit its all-time high of $218. In the long term, Smart Contracter says he sees Solana igniting a massive rally to $900 as he believes SOL is following in the footsteps of Binance Coin’s (BNB) epic surge earlier this year.

“Monthly reminder $900 SOL is not a joke. It’s gonna happen.”

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Source: Smart Contracter/Twitter

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Ethereum

EIP-4490, EIP-4488 can help lower transaction fees on Ethereum and more, but…

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While most people might be busy with holiday shopping, Ethereum core developers are also seeing a packed schedule as the Merge nears. With updates to be announced and proposals to be discussed, Ethereum developer Tim Beiko shared a thread summarizing the events of the most recent All Core Devs meeting.

Do you ‘node’, what’s going on?

Naturally, the Merge was on everyone’s minds and Beiko reminded the community that the second and third devnets would be taking place the following week, with a last devnet on 14 December.

Next, Beiko admitted that fees were high not just on the Ethereum mainnet, but also when using rollups. He spoke about two solutions – EIP-4490 and EIP-4488. Both proposed reducing calldata costs to reduce transaction fees. However, participants were reportedly divided as to whether this should happen before or after the merge.

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Beiko explained,

“Also, the amount of work here is fairly small: change a gas price, add a validity check and (hardest!) implement a new txn pool sorting algorithm.”

He added,

“If we do want to ship this before the merge, though, we need to act fast: the fork would have to hit mainnet in February at the latest, and we only have one more ACD [All Core Devs meet] before the end of this year!”

What’s more, Beiko suggested that client prototypes might come during the next two weeks.

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Not just a case of “Ether” this or that

Beiko summarized some other problems that the developers discussed during the meet. One major challenge was to make Ethereum sustainable in the long term. For this, Beiko said there were conversations about EIP-4444, which is meant to deal with Ethereum’s historical data and the storage issues caused by the same.

Beiko also reminded users about the Arrow Glacier upgrade around 8 December, which would push back the difficulty bomb.

Running out of space

Notably, historical data from past blocks on the Ethereum chain are growing, and validators reportedly have been forced to use bigger and bigger hard disks. In a Reddit AMA, Vitalik Buterin admitted he faced the same problem. While introducing historical expiry, he said,

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“…instead of all full nodes having to download and serve the full chain from genesis, and needing to have ever-increasing technical complexity to deal with both old and new versions, the core Ethereum protocol would only be responsible for holding and serving the most recent ~1 year of historical blocks, transactions and receipts/logs.”

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Vitalik Buterin proposes calldata limit per block to lower ETH gas costs

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Ethereum co-founder Vitalik Buterin has proposed a new limit on the total transaction calldata in a block to decrease the overall transaction calldata gas cost over the ETH network. 

Buterin’s post on the Ethereum Magicians forum, EIP-4488, highlights concerns regarding high transaction fees on layer-one blockchains for rollups and the considerable amount of time to implement and deploy data sharding:

“Hence, a short-term solution to further cut costs for rollups and to incentivize an ecosystem-wide transition to a rollup-centric Ethereum is desired.”

While the entrepreneur cited an alternative wherein the gas costs parameters could be decreased without further adding a limit to the block size, he foresees a security concern in decreasing the calldata gas cost from 16 to 3:

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“[This] would increase the maximum block size to 10M bytes and push the Ethereum p2p networking layer to unprecedented levels of strain and risk breaking the network.”

Buterin issued a decrease-cost-and-cap proposal, which aims to achieve the goal of reducing unprecedented levels of strain and risk breaking the network, and believes that “1.5 MB will be sufficient while preventing most of the security risk.” As for advice to the Ethereum community, he wrote:

“It’s worth rethinking the historical opposition to multi-dimensional resource limits and considering them as a pragmatic way to simultaneously achieve moderate scalability gains while retaining security.”

If accepted, the implementation of the proposal will require a scheduled network upgrade, resulting in a backward-incompatible gas repricing for the Ethereum ecosystem. This upgrade will also mean that miners will have to comply with a new rule that prevents the addition of new transactions into a block when the total calldata size reaches the maximum. “A worst-case scenario would be a theoretical long-run maximum of ~1,262,861 bytes per 12 sec slot, or ~3.0 TB per year,” the proposal read.

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However, the community is discussing other options like the implementation of a soft limit. Others raised concerns about the congestion during nonfungible token (NFT) sales, which may require users to compensate for the lack of execution gas by paying a higher total fee.

Rising gas fees have resulted in an outflow of users from the Ethereum network to lower the cost of Ethereum Virtual Machine-compatible networks.

As Cointelegraph reported on Nov. 4, Etherscan data shows that approving a token to be transacted on Uniswap decentralized finance protocol can cost as much as $50 worth in Ether (ETH).

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Average Ethereum gas cost. Source: Etherscan

Additionally, layer-two solutions, which were billed as the protocols that would help solve the fee issue, have been charging high fees due to network congestion amid the onboarding of new users.

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Ethereum price could easily double as ETH long term outlook screams bullish

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Ethereum as ultra-sound money
  • Ethereum price has formed a chart pattern on the weekly chart that indicates an optimistic outlook of a 97% ascent.
  • ETH must clear a few critical resistances before the bullish forecast could be validated.
  • Holding above $3,917 is crucial for the token’s rise toward $10,000.

Ethereum price continues to consolidate and discover reliable support above $4,000. ETH appears to be preparing for a massive bull run, as a technical pattern suggests that the second-largest cryptocurrency by market capitalization is looking to double its value in the longer term.

Ethereum price eyes $10,000

Ethereum price has printed a bull pennant pattern on the weekly chart, suggesting that ETH is eyeing higher prices. The prevailing chart pattern suggests that if the token slices above the upper boundary at $5,252, a 97% ascent toward $10,418 is on the radar.

ETH weekly

ETH/USDT weekly chart

The first area of resistance for Ethereum price appears to be at $4,211, where the 50-day Simple Moving Average (SMA) and the 78.6% Fibonacci retracement level coincide. Additional resistance will emerge at the 21-day SMA at $4,421. 

The token’s all-time high at $4,884 will then act as an additional obstacle for Ethereum price, but slicing above this level could unravel further bullish intentions for ETH.

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If Ethereum price manages to break above the aforementioned resistances, ETH may target the last remaining obstacle before the bullish outlook is validated, at the upper boundary of the bull pennant at $5,252. The 97% climb toward $10,418 would then be on the radar, but the token would be confronted by several hurdles, including the 127.2% Fibonacci retracement level at $5,762, then at the 161.8% Fibonacci retracement level at $6,866. 

ETH daily

ETH/USDT daily chart

However, if Ethereum price faces profit-taking, ETH would discover the first line of defense at the September 3 high at $4,020, then at the October 16 high at $3,962. The lower boundary of the governing technical pattern at $3,917, coinciding with the support line given by the Momentum Reversal Indicator (MRI).

Investors should note that if Ethereum price slices below the aforementioned foothold, the bullish thesis may be invalidated and ETH could continue to slide lower, as it searches for reliable support at the 100-day SMA at $3,762, then at the 61.8% Fibonacci retracement level at $3,675. 

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