GWEI, the native token of ETHGas, has increased from a low in June below $0.10, to almost $0.20. The token is up more than 750% since the lows of February, and it’s one of the top performing altcoins in spite the crypto market decline.
On Saturday the 13th, Bulls appeared to be on the brink of breaking a major ceiling which has been blocking further upward trend since the start of the year. (Trendline Resistance, Dotted White Line).
The technical indicators showed that potential buyers were becoming tired. What is the best direction for GWEI’s What is a parabolic movement?
What is next for the ETHGas Rally?
In the price chart the last leg of the rally started from the Fibonacci level golden area (50%-61.8%). It is worth noting that this area also served as a strong support during April. Therefore, the $0.10 price line becomes a crucial demand if GWEI’s profit-taking increases.
If the target of $0.25 is reached, the potential for an 18% increase can be realized. This move would be confirmed by the GWEI staying above the resistance trendline.
If it fails to overcome the roadblock of several months, the next important support levels are $0.16 and $0.05.
The daily chart RSI has entered overbought. The RSI (relative strength index) on the daily chart had entered overbought territory.
It is possible that if GWEI does not stay above trendline resistance and the fatigue creeps in, a cooling-off will be imminent.
What drives the ETHGas Pump?
ETHGas, for those who are unfamiliar with it, is a market that allows users, during times of network congestion, to purchase blockspace in advance. This marketplace is designed to help solve the Ethereum Gas Fee problem. But it does more.
The futures market is more of a prediction marketplace that allows you to gauge the spikes or drops in demand for Blockspace. It also allows users the option to hedge their positions accordingly.
The price of GWEI has had a strong correlation with the demand or price for gas.
A notable example was the emergence of a spike Gas prices dropped in early June and mid-May. The demand for bitcoin was therefore relatively higher.
GWEI surged 250% during the same period. At the moment, blockchain demand is waning. If the correlation remains, GWEI’s rally may also slow down.
Final Summary
- ETHGas GWEI increased from $0.10 per share to $0.20, and it could increase by another 18% if the upward trend persists.
- The recovery may face some cooling as an indicator showed potential exhaustion among buyers.
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Source: ambcrypto.com
