Here’s Why the Ethereum Name Service (ENS) Price Increased by 40% Today

The Ethereum Name Service (ENS) price has increased sharply in the past two days, culminating with a high of nearly $25 today.

The ENS increase caused a breakout from long-term diagonal and horizontal resistance levels.

ENS Finally Breaks Out

The ENS price had fallen under a long-term descending resistance trend line since January 2022. The decrease led to a low of $6.65 in October 2023. The ENS price has increased since, greatly accelerating the rate of increase in the past two weeks.

The upward movement caused a breakout from the descending resistance trend line this week, which had been in place for 710 days. The increase led to a high of $24.96 today, taking the price to a horizontal resistance area.

ENS/USDT Weekly Chart. Source: TradingView

When evaluating market conditions, traders use the RSI as a momentum indicator to determine whether a market is overbought or oversold and whether to accumulate or sell an asset.

If the RSI reading is above 50 and the trend is upward, bulls still have an advantage, but if the reading is below 50, the opposite is true. The weekly RSI is increasing and is above 50, both signs of a bullish trend.

ENS Price Prediction: Is $50 Achievable?

The technical analysis from the daily time frame suggests that the ENS trend is bullish, but a local top may be reached soon. This is because of the wave count and RSI readings. 

Technical analysts utilize the Elliott Wave theory to ascertain the trend’s direction by studying recurring long-term price patterns and investor psychology.

The wave count indicates that ENS is in wave three of a five-wave upward movement. Wave three has extended and has 4.61 times the length of wave one. This is often the biggest size of an extension.

Cryptocurrency trader EliZ noted the massive ENS increase and joked that an “ENS ETF” will be coming soon.

The bearish divergence in the daily RSI also suggests that a top may be close, as does the fact that ENS trades in a horizontal resistance area.

So, the ENS price may correct by 25% to the 0.382 Fib retracement support level at $18.

ENS/USDT Daily Chart. Source: TradingView

Despite this bearish short-term ENS price prediction, a close above $24 can trigger a 75% increase to the next resistance at $40.

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