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Ethereum $3,300 Support Tested as Vitalik Buterin Unveils Next Steps – Will It Hold?

Last Updated April 2, 2024 11:40 AM
Valdrin Tahiri
Last Updated April 2, 2024 11:40 AM
By Valdrin Tahiri
Verified by Peter Henn

Key Takeaways

  • Ethereum’s founder Vitalik Buterin unveiled the next steps in Ethereum’s roadmap.
  • The ETH price has fallen to a critical short-term support level at $3,300.
  • Will the ETH price bounce, or is a breakdown that leads to new lows more likely?

Vitalik Buterin’s proposal aims to reduce the amount of storage required to run an Ethereum node, in turn improving node decentralization and network congestion.

The ETH price has corrected since reaching a yearly high on March 13. It reached a short-term support level at $3,300 today. Can the price initiate a bounce, or will it fall below this level?

Vitalik Unveils Proposal

Ethereum’s “The Purge” is a series of updates designed to clean up the network and make it simpler. These upgrades aim to cut down on old data stored on the network, making it easier to manage for node operators.

With these changes, Ethereum can use resources more efficiently and make the ecosystem stronger. It is the next step in the Ethereum roadmap .

Ethereum Roadmap
Ethereum Roadmap | Credit: X

Vitalik Buterin outlined the next steps of the purge in an update today. Currently, it is difficult to run a node since each node has to store all of the data forever. Ethereum Improvement Proposal (EIP) 4444 will remove this requirement. Due to the reduction in the amount of storage required to run an Ethereum node, it is possible that a higher number of people will decide to run nodes, hence greatly improving node decentralization.

Vitalik also proposed an approach where small users get reimbursed first during a protocol hack or crash, calling it “Degen communism” .

ETH Price Prediction: Will Short-Term Support Hold?

The ETH price has fallen since March 31, when the $3,650 horizontal resistance area rejected it. The decrease is contained inside a descending parallel channel, a pattern that often contains corrective structures.

ETH currently trades at the channel’s support trend line and very close to the 0.618 Fib retracement support level near $3,300. Additionally, the hourly RSI is in extreme oversold territory. Similar oversold levels often led to significant price bounced (green icons).

Ethereum Price Falls to Support
ETH/USDT Hourly Chart | Credit: TradingView

Since there is no bullish divergence in place yet, it is possible that ETH will fall slightly further to the $3,250 horizontal support area. However, a significant bounce is expected eventually that causes the price to break out from the parallel channel.

Oversold RSI Levels Can Lead to ETH Bounce

The ETH price has corrected significantly in April, but the downward movement has become oversold. Similar readings previously led to price bounces. If history repeats, the ETH price will bounce soon, breaking out from its parallel channel pattern.

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