Ether Could Gain $500 in The Coming Hours With The Merge

Ethereum

How prepared Are you for the Ethereum Merge?

The Merge, which has severally been described as the most important update on the Ethereum network, is poised to take place today, September 14. Several people have suggested ways to make maximum benefit of it, bearing in mind that if there are forked coins, that not every centralized exchange out there would support distribution of the forked coin.

Proof-of-work To Proof-of-stake

The Merge essentially moves the Ethereum blockchain from a proof-of-work consensus protocol to a proof-of-stake. Proof-of-stake is less energy intensive and doesn’t raise as much environmental concern as proof-of-work. Bitcoin is an example of a cryptocurrency that uses proof-of-work to protect its network.

So what are we expecting today in the coin market as Ethereum migrates to proof-of-stake?

A Modest 3% in 24 Hours

At the time of reporting at 4.00 AM on September 14, ether is down by 7% on the 24-hour chart. This is despite the fact that the coin attained a 3-week high on September 13. On the 7-day chart, ETH is up by 3%. The implication of this modest gain on the 7-day chart may not be obvious immediately.

A Short-Term Pull Back

On September 13, ETH formed a new resistance at $1,789, according to data from Binance. The coin has since dipped below $1,600 and is currently trading at $1,585 at the exchange. However, what is apparent is that the pull-back from the new 3-week high of $1,789 is that the coin is consolidating. This is not surprising considering that this happened on the eve of the Merge.

Updates such as the Merge are usually linked to upswings in the coin market, so a big surge in the value of ether is expected today. How long this would last and if it would be sustained is another matter.

ETH Market Analysis

The ETH/USD chart shows that ether is primed for a boost. Using the RSI indicator, we can see that the Relative Strength Index is registering the value of 34 after bouncing off the 30 level. This is an indication that ether is in the oversold region and its price is already primed for higher values.

Most CEXs made it clear that there would be suspension of deposits/withdrawals during the period of the Merge. Some, such as BitMEX announced that they are not certain that they would distribute forked coins. To make the most out of the ETH that the investor owns, it is advisable that they keep their coins off exchanges that wouldn’t support the distribution of forked coins. What is obvious however is that ether could gain $500 in the coming hours.

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Author: Jinka Kamma

Jinka Kamma is passionate about the prospects of blockchain and the freedom cryptocurrencies afford people across borders. He holds small amounts of bitcoin and tether.

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