The Ethereum price is rallying above the $1,820 level against the US Dollar. ETH/USD could go higher if it breaks above the $1,880 resistance zone. On the other hand, Vitalik Buterin warned on Sunday about the risks of overloading the consensus layer of the platform through the participation of ETH.
The Ethereum price is contemplating a bullish break above the $1,850 resistance against the US Dollar, as it is now trading above $1,750, and the 55 simple moving average (4 hours).
There was a break above a key contracting triangle, with resistance near $1,820 on the 4-hours chart (data feed from Coinbase). The pair could go higher if it sustains above the $1800 support zone.
In other news, via a blog post, Vitalik Buterin, Ethereum co-creator, explained that using the consensus layer to perform soft forks and some staking activities can carry high systemic risks, leaving the Ethereum Blockchain vulnerable. According to the developer, Ethereum’s consensus layer can become susceptible to attacks if the Blockchain is overloaded.
Ethereum Price Analysis
In the past few days, Ethereum saw a downward correction from the $2,020 zone against the US Dollar. ETH price dipped below the $1,850 level and the 55 simple moving average (4 hours).
The bears even pushed the price below the $1,750 level. A low was formed near $1,737 and the price is now attempting a further rise. There was a move above the $1,800 resistance level. The price broke the 23.6% Fibonacci retracement level of the downward move from the $2,020 high to the $1,737 low.
There was also a break above a key contracting triangle with resistance near $1,820 on the 4-hours chart. It is now trading above $1,750 and the 55 simple moving average (4 hours).
Immediate resistance to the upside is near the $1,880 level. It is near the 50% Fib retracement level of the move down from the $2,020 high to the $1,737 low. The next major resistance is near the $1,920 zone. A clear move above the $1,920 level could send the price to $2,000.
Currently, the Ethereum price is trading above the $1,750 zone and the 55 simple moving average (4 hours). Overall, the Ether price could go higher if it sustains above the $1800 support zone.
More gains could even send the price toward the $2,150 or $2,200 resistance zone in the near term. On the downside, initial support is near the $1800 level. The next big support is now near the $1,750 level. A break below the $1,750 support could take the price to $1,600. Further losses could take the price to $1,550 or even $1,500 in the coming days.
Ethereum Overload
Buterin acknowledged that while most proposals to use the Ethereum or ETH consensus layer in staking are well-intentioned, the Ethereum’s consensus layer features present risks to the underlying Blockchain, such as increases in costs, complexities, as well as risks of running a validator. Therefore, they should be discouraged.
According to him, exposing layer 1 by extending the responsibilities of the consensus layer to other risks could compromise the functionality of both the Blockchain and all the layers that are linked to it. This issue has a direct impact on the stability and resilience of Ethereum.
By Audy Castaneda
