“Ethereum (ETH) Surges Beyond $1,870 Resistance, On-Chain Analysis Suggests Potential Path to $2,000”
“In the early hours of Thursday, the price of Ethereum (ETH) broke through the $1,870 resistance level. On-chain data analysis identifies key factors that may propel ETH towards the $2,000 range in the upcoming days.”
“Ethereum bulls achieved a new 60-day high of $1,875 on Thursday, with a slight retracement thereafter. The question now is whether the increasing burn rate can further fuel the rally.”
Ethereum is Drawing Above-Average Trading Volume.
“On Thursday morning, Ethereum’s price made another upward move in its quest to reclaim the $2,000 mark. While ETH gains are currently lagging behind Bitcoin (BTC), recent on-chain data indicates that Ethereum is experiencing an unusually high transaction volume.
Notably, the total fees generated from daily transactions on the Ethereum network have been steadily increasing since August, as per data from IntoTheBlock. As illustrated below, the Total Fees generated reached a 60-day high of 3,350 ETH on November 1.”
![](https://sollcrypto.com/wp-content/uploads/2023/11/Screen-Shot-2023-11-02-at-11.12.11-PM.png)
Growing Burn Rate Has the Potential to Strengthen Bullish Momentum.
“In April 2023, the Ethereum network successfully implemented the Shappela upgrade, finalizing the shift from the Proof of Work to the Proof of Stake consensus. With the PoS consensus in place, a considerable portion of the ETH Gas fees collected from users is now daily burned.
The burning of coins results in their permanent removal from the circulating supply, creating an intrinsic deflationary mechanism that exerts upward pressure on ETH prices.
As anticipated, the burn rate has progressively increased in tandem with the surge in ETH fees and transactions over the past two months.”
![](https://sollcrypto.com/wp-content/uploads/2023/11/Screen-Shot-2023-11-02-at-11.14.07-PM.png)
“Ethereum (ETH) Total Fees Burned – Data Source: TheBlock
The chart presented above illustrates that between October 28 and November 1, a total of 7,960 ETH, equivalent to approximately $15 million, were permanently removed from circulation. It’s worth noting that the 2,610 ETH, amounting to around $5 million, burned on Wednesday marked the highest burn rate since August.
The growing burn rate’s deflationary impact contributes to long-term market scarcity. If this trend of increasing burn rates continues, Ethereum’s price may make significant gains relative to Bitcoin as we approach the year’s end.”
Ethereum (ETH) Price Forecast: Heading Towards $2,000?
“From an on-chain perspective, Ethereum’s price appears poised to reclaim the $2,000 range in the coming days.
The Global In/Out of the Money data, which provides insights into the historical buying trends of Ethereum holders, reinforces this outlook. It highlights that the $1,880 level serves as a significant resistance point on the path to $2,000.
As illustrated below, there are 9.12 million addresses holding 39.13 million ETH purchased at a minimum price of $1,880. Should they decide to initiate a rapid sell-off, it could potentially trigger a retracement.
However, a definitive breakout beyond this zone could pave the way for the predicted ETH price rally to reach $2,000.”
![](https://sollcrypto.com/wp-content/uploads/2023/11/Screen-Shot-2023-11-02-at-11.15.53-PM.png)
“However, the bears could nullify this forecast if Ethereum’s price drops below the $1,600 threshold. Nevertheless, as previously noted, the bulls are expected to establish robust support around the $1,650 mark.
The chart above indicates that 7.6 million addresses presently possess 13.27 million ETH acquired at the minimum price of $1,640. If they choose to hold onto their holdings, it is probable that a significant Ethereum price correction can be averted.
Nonetheless, should this support level falter, it may initiate an extended downturn in Ethereum’s price toward $55.”