Ethereum supporters are gushing with anticipation for the upcoming London hard fork, which is slated to take place on August 5th at block height 12,965,000.
Data from Cointelegraph Markets Pro and TradingView show the price of ether rose from a low of $ 2,450 in the early hours of Jan.
One of the most common occurrences in the crypto market is a huge price spike before a big news announcement or protocol upgrade, followed by a price dumper, as those who received an early withdrawal to secure profits and those who were late to party become bag holder.
Ethereum’s London hard fork was one of the most talked about events of 2021, so it would be short-sighted to assume the price will only go up, a point highlighted in the following tweet from Murfski, a pseudonymous crypto analyst, on Twitter.
Are we all ready to sell the news?
** Turns off notifications ** pic.twitter.com/Ve7FgUHzcF
– Murfski (@Murfski_) August 4, 2021
As can be seen from the graph provided, the analyst cautioned against assuming that the price of Ether would rise above $ 3,000. According to Murski, if the price hits $ 3,000, it could be quickly followed by a pullback to as much as $ 2,000 if the token sold out after the upgrade.
While nothing is certain, the historical trend of price dumping after major developments should not be dismissed despite the bullish price development of Ether.
“In my defense, I was bullish downstairs. As we approach the range highs, you’d better be careful. Much luck.”
Hard forks have historically been bullish on Ether price
Insight into post-London Hard Fork expectations for Ether price can be gained by looking at how past upgrades have affected the price. Local highs in Eth come an average of 80 days after major upgrades, according to cryptocurrency analyst Josh Olszewicz.
The local highs of $ ETH have historically occurred an average of 80 days after previous hard forks
if London is similar, the local high should occur in late October / early November pic.twitter.com/YFtj9L1Kiz
– Josh Olszewicz (I won’t dm you) (@CarpeNoctom) August 4, 2021
These observations by Olszewicz were further corroborated by crypto-economist Ben Lilly, whose detailed breakdown shows that the average returns after upgrades are “5.1% in the following 30 days, 28.8% after 60 days and 64.4% after 90 days” deceive.
Given this historical performance, Lilly is cautiously optimistic that Ether can still make profits in the future after the London upgrade.
“Although, at first glance, many of the gains we normally see with Ethereum upgrades may already have been implemented, I suspect there is still room. This is especially true when we rely on our internal signals that point to uptrends for ETH. London is definitely a great catalyst event to watch for the coming days to weeks. “
Related: According to ConsenSys, DeFi is attracting 2.91 million Ethereum addresses
A short-term correction could occur in the short term
According to Cointelegraph employee Michaël van de Poppe, there is a possibility of a pullback as soon as the hard fork is implemented.
I expect a short-term top on $ ETH to take place tomorrow.
Healthy correction to EIP-1559 before the toughest bull run of all takes place.
– Michaël van de Poppe (@CryptoMichNL) August 4, 2021
While van de Poppe expects a short-term correction in the price of ether, his long-term outlook for the altcoin is bullish and he predicts that “the hardest bull run of all” will come after the pullback.
The views and opinions expressed are those of the author only and do not necessarily reflect the views of Cointelegraph.com. Every step of investing and trading involves risk, so you should do your own research when making a decision.