Can Ethereum (ETH) Price Reach $2,000 Soon? —Here’s What to Expect

 Ethereum Price Insights:

• Ethereum (ETH) price reclaimed the $1,850 territory on Thursday, October 2023, as the bulls extended the rally to a new 60-day peak. 
• Similarly, Transaction fees on the Ethereum network have also reached a new 60-day high, confirming a growing bullish theme. 
• While the Relative Strength Index (rsi) trends in overbought territory, another vital technical indicator suggests ETH traders could hold out for higher prices. 

Ethereum (ETH) price broke above the $1,850 resistance on Thursday, October 2023, as the bulls extended the rally to a new 60-day peak. On-chain data analysis pinpoints critical factors that could drive the ETH price rally above $2,000.

Ethereum is Attracting an Unusually High Number of Transactions 

Ethereum price made another leg-up toward the $2,000 milestone on Thursday morning. Although the ETH price rally is still currently trending behind Bitcoin (BTC) on-chain data trends show that the Ethereum is now attracting an unusually high number of daily transactions. 

Indicatively, the IntoTheBlock chart below illustrates how total Transaction Fees generated daily on the Ethereum network has been on a persistent rise since August. As seen below, Total Fees generated on Ethereum reached a 60-day peak of 3,350 ETH on November 1. 

The Total Fees metric sums up the total amount that network participant pay to carry out transactions on a given day. Intuitively, a persistence increase in Fees collected is a clear indication that the Ethereum network is attracting more usage. 

Typically, increased network usage in a bullish signal which confirms that the ongoing ETH price rally is driven by organic growth, rather than just speculations on market sentiment. 

Rising Etherum Burn Rate Could Further Accelerate the Price Rally

In April 2023, Ethereum network executed the Shappela upgrade, which marked the complete transaction form Proof of Work to Proof of Stake transition. One of the major effects of the PoS mechanism is that percentage of the transaction fees collected from users is now burned daily.

When coins are burned they are removed from circulation supply permanently. This increases scarcity and puts upward pressure on price. 

Interestingly, as ETH Fees and transactions increased over the last two months, the burn rate has also been on a steady rise.

The chart above shows that 2,610 ETH worth approximately $5 million were destroyed on October 31 alone. Notably, more than 80% of the daily Fees generated on Ethereum is now burned as a result of the transition to the Proof of Stake consensus.  

Hence, the deflationary impact could increase market scarcity and further accelerate the Ethereum price rally in the days ahead.  

ETH Price Prediction: Road to $2,000

From an on-chain standpoint, Ethereum price looks set to reclaim the $2,000 territory in the days ahead. Technical analysis indicators also support his thesis. 

Although the Relative Strength Index has been trending in overbought territory for over a week, the Bollinger Bands indicator suggest ETH holders could hold out for higher prices. 

As seen below, the Upper Bollinger Band currently lies at $1,922. A decisive breakout above that resistance level could set off a prolonged ETH price rally toward $2,000. 

But on the downside, the lower Bollinger Band is at $1,487. Hence if ETH fails to defend that vital support level, the momentum could effectively swing bearish.