Ethereum, which has just completed the Pectra upgrade, has seen a remarkable increase recently, with ETH breaking through $2,700 this morning. Bulls are optimistic about a return to a bull market, while bears question the upward momentum.

Last night, the U.S. Consumer Price Index (CPI) came out lower than market expectations, indicating that inflation has not heated up, which strengthened the market's expectations for the Federal Reserve to cut interest rates this year. Bitcoin once again approached $105,000.

Ethereum is even stronger, breaking through $2,700 early this morning, reaching a high of $2,738. As of today (14th) at 9:30, it reported $2,702, a surge of 10% in the last 24 hours, reaching a two-and-a-half-month high, performing the best among the top ten tokens.

Where does the upward momentum come from?

From a fundamental perspective, the Pectra upgrade launched on May 7 not only enhances network efficiency but also introduces account abstraction features (EIP-7702), allowing users to manage wallets more flexibly. The optimization of the staking mechanism raises the validator ETH cap from 32 ETH to 2,048 ETH, while introducing flexible withdrawal methods to make it easier for institutions and individuals to maintain network security.

Additionally, Ethereum continues to attract attention from various institutions, with expectations that it will gain SEC approval for ETH staking this year, and that giants like BlackRock will strengthen their efforts in RWA tokenization, all of which are expected to enhance the liquidity and long-term value of Ethereum.

Market analyst VirtualBacon recently predicted that if Bitcoin reaches $200,000, Ethereum's price may also reach $10,000.

ETH Technical Analysis

According to Fxstreet analysis, ETH is currently also in an upward trend from a technical perspective.

  • Breaking through the downtrend line (DT), which has suppressed all upward trends since the peak in December.

  • Above its rising red 20-day simple moving average, which is located above the (blue) 50-day simple moving average.

The only short-term obstacle is the 200-day SMA (red line in the chart below); it has just broken through and retraced. If it can stabilize above this line, the short-term target may potentially reach $3,100.

However, due to many uncertainties in the current global economic environment, liquidity is not yet sufficient to support a major bull market. Many bearish individuals believe that the current stage is a 'dead cat bounce', rather than a complete reversal. If a significant pullback occurs, ETH may challenge the support level of $2,100.