Ethereum price (ETHUSD) is down by more than 2% as the US dollar strength and a sell-off of alternative assets continues. The currency is trading at $334 against, which is the lowest it has been since September 9.
ETH started its downward trend on 1st September, when it rose to a high of $486. Interestingly, the US dollar index fell to its two-year low of $92.32. The price of Ethereum – and other cryptocurrencies – tends to have a close inverse relationship wit the US dollar. Indeed, the currency is falling today as the dollar index rises by about 0.30%.
Ethereum price is falling as the ETH 2.0 update continues. In a statement yesterday, the Ethereum Foundation announced the Spadina launchpad. It will be launched on Tuesday next week and have a three-day end of life.
Spadina is defined as a “rapid-fire dress-rehearsal” for the ETH 2.0 testnet. The launchpad is the last testing stage before the mainnet launch.
In the statement, the foundation also noted that Trail of Bits, a digital security firm, had completed the audit of the ETH 2.0 deposit tool that will be used widely after the update. As a result, the developers are now fixing the findings of the audit and making the recommended fixings.
For starters, ETH 2.0 is the biggest update in Ethereum’s network history. Its goal is to transition the network from a system of proof -of -work to a proof -of-stake. It will make the network faster and more secure. It will also increase energy efficiency and lower barriers to entry.
Proof-of-work is the concept that powers ETH and BTC today. However, POS will use validators who will commit a stake to attest or validate blocks into existence.
Ethereum price forecast
Ethereum price has been in a steep downward trend this month. On the daily chart, it has moved below the 20-day weighted moving average and is in its lowest level since September 9. Also, the price has moved below the bearish flag pattern that is shown in pink, which is a signal that bears have prevailed.
Therefore, I suspect that the price will clear the 38.2% Fibonacci retracement and head to the 50% retracement at $288. (This retracement connects the lowest and highest levels this year). On the flip side, a move above the 23.6% retracement at $390 will invalidate this prediction.