Fundstrat’s Tom Lee Anticipates Ethereum’s Low Point and Surge Beyond $5,000

Tom Lee of Fundstrat predicted a temporary low for Ethereum on Tuesday, followed by a rise beyond $5,000, just as the token started to increase in value.

Referencing a message from Fundstrat’s Mark Newton, Lee, also chair of ETH treasury BitMine Immersion, supported the idea that Ethereum is unlikely to drop below $4,000 in the short term.

Newton’s message indicated a potential bottoming out for the altcoin “within (the) next 12 hours near $4,300,” though the exact time he sent it to Lee remains unclear.

Ethereum dipped to $4,341 early Monday but has since rebounded above $4,550. Currently, it has fallen approximately 1% in the last 24 hours and around 8% from its all-time high of $4,946 on Sunday.

A market analysis by Myriad Linea found that 80% of respondents expect Ethereum to exceed $5,000 this year.

(Disclosure: Myriad is a prediction market and engagement platform developed by Dastan, the parent company of an editorially independent Decrypt.)

Both Newton and Lee mentioned that the cryptocurrency could rise to $5,450, with an accompanying chart suggesting it could settle around $4,800 by mid-September.

However, not all analysts share the optimism regarding an immediate Ethereum rally. TradeNation’s Senior Market Analyst David Morrison stated to Decrypt that further declines could be on the horizon.

“I agree that there’s potential for more upside by year-end, but Ethereum appears significantly ‘overbought’ according to its daily MACD [moving average convergence divergence],” he remarked. “This indicates a possible pullback from current levels before it can rise significantly higher, or at least a phase of sideways consolidation to alleviate some excess.”

Morrison added that Bitcoin seems to present a more appealing upside potential due to its daily MACD returning to neutral levels.

Other analysts, including eToro’s Simon Peters, also believe that Ethereum’s price could see further declines soon.

He expressed to Decrypt, “September is historically a weak month for crypto prices, and given the 250% rally since April, achieving a new all-time high, some long-term holders may choose to take profits.”

Peters also pointed out that Ethereum’s trajectory might hinge on the U.S. central bank’s interest rate decision during its next monetary policy meeting on September 16 and 17.

“If the Federal Reserve maintains interest rates in September, when markets expect a cut, it may trigger a short-term downturn,” he noted.

In the medium term, Peters remains optimistic about Ethereum’s potential for a “strong run” by the year’s end, citing several factors.

“Firstly, the regulatory environment for crypto, especially in the U.S., is advantageous,” he noted. “This will encourage more institutions to utilize Ethereum as the foundational layer for stablecoins and tokenizing real-world assets.”

Peters expects robust demand for Ethereum, driven by spot ETFs and an increasing number of public companies steadily accumulating tokens in recent months.

“Additionally, global interest rates are declining while the money supply is increasing,” he added, implying that a rise in disposable income could attract more retail investors to crypto.

While David Morrison recognized the significance of ongoing upgrades and institutional interest in Ethereum, he remains cautious about expecting drastic short-term gains.

“Currently, and based on the charts, Bitcoin appears to hold more potential for the remainder of the year,” he stated. “Ethereum might need to address its current overexcitement before finding a base for its next upward movement.”

Conversely, some analysts argue that Bitcoin poses another risk for Ethereum, as BTC’s recent downturn may negatively affect ETH.

Analyst and author Glen Goodman shared with Decrypt that institutional interest in Ethereum ETFs could benefit the altcoin, yet a continued decline in Bitcoin may drag down ETH.

“ETH might withstand a lackluster BTC; it could even rise as Bitcoin struggles,” he stated. “However, if BTC experiences a significant drop, it’s unlikely ETH can resist the downward force of a crashing Bitcoin.”