Ethereum Price Prediction: Is ETH Ready to Make History and Hit $5,000?

Who would have thought that in the same year we saw Ethereum (ETH) dropping below $2,000 we would see it bouncing off these lows and surging near the $4,000 threshold?

It has been a wild year with less than 7 months in. We had a short-lived trade war, massive bombings in the Middle East, and Bitcoin reaching a new all-time high and now we could be on the brink of the beginning of altcoin season.

Bitcoin’s dominance is still at 60% but it certainly feels as if altcoins are starting to catch up. ETH has now swung to positive territory on a year-to-date basis after losing half of its value at some point this year.

The top altcoin has booked a solid 63% gain in the past 30 days, primarily aided by the approval of the Genius and Clarity Acts in the United States but also amid the positive impact that the Pectra upgrade has had in the network’s operational framework.

Trading volumes have surged recently and have reached 10% of the token’s circulating market cap. This is no small feat, especially as activity in the futures market has spiked as well.

ETH Hit Our Latest Prediction of $3,800

We recently shared two short-term predictions for ETH and both were hit just a few days after. The first anticipated a move to the $3,650 level after a bullish rounding bottom pattern was confirmed on July 14.

ETH/USD Prediction from July 14 – Source: FXEmpire

The other required a much stronger move to invalidate a former trend line support that could act as resistance for the price action. The target for that one, once confirmed, was the $3,800 level, which was also hit.

A 25% gain was made in just 8 days after those predictions came out. However, the past is in the past and the question is: What now? Can ETH hit $4,000?

With 25% more to go before hitting an all-time high, the weekly chart provides a better perspective of the hurdles that the price action will soon face.

Average Transaction Fees Stabilize – Is ETH Ready for $5,000?

Looking at this higher time frame, we can see that the $3,900 – $4,100 has been an area where selling pressure has been quite strong in the past. The last time ETH got to that level, it declined by 67% in just four months.

ETH/USD Weekly Chart (Bitstamp) – Source: TradingView

This would be the fourth time in around 16 months that the token has approached this level. However, one major change has happened since the last time ETH traded at $4,000 – the Pectra upgrade has been successfully implemented.

One of the most interesting trends that on-chain data shows is that average fees paid per transaction within the Ethereum network have stabilized lately to a range between $0.50 and $2 tops following the Pectra upgrade.

Average Transaction Fee on Ethereum – Source: Etherscan

This is a major improvement from the volatile periods we have seen previously (as shown in the chart) and could ignite further ecosystem growth, trading volumes, and adoption.

Ethereum’s scalability and cost issues had plagued the network for years and, if they have been truly solved and contained by Pectra, this means that we could see ETH rising to much higher levels as the market could now consider this an operational breakthrough.

If that’s the case, this upcoming touch of this “kill zone” for ETH could finally result in a bullish breakout that could propel the token to levels we have not seen since 2021.