Key Takeaways:
- Crypto trader and KOL going by the name SalsaTekila predicts Ethereum (ETH) will reach $5,000 sooner or later.
- The crypto market cap showed a downward trend as interest rate expectations decreased after higher-than-expected PPI Data.
- But the trader also predicts higher volatility and warns of liquidation risks.
The market capitalization (market cap) of the entire crypto industry has decreased by 3.97% going from $4.19 trillion to $4.03 trillion in one day at the time of writing. This is due to a jump in the interest rate expectations after the release of the Producer Price Index (PPI) data, which was reported at 0.9% much higher than the expectations of 0.2%. As a result, several cryptocurrencies have fallen significantly, with ETH facing a pullback of 0.4% in one day currently trading at the levels of $4.6K levels according to CoinMarketCap at press release.
Famous trader and Key Opinion Leader (KOL) known as @SalsaTekila on X with over 220K followers recently tweeted saying Ethereum (ETH) could reach $5K. The trader is comparing its current behavior to the early days of Bitcoin (BTC). For new traders and investors, this might sound exciting, but there’s a lot more going on under the surface.
“ETH Feels Like Early BTC” – What Does That Mean?
The trader claims that ETH currently reminds them of how BTC behaved in its early years, when it was volatile and showed unexpected price movements. In those days, BTC’s price fluctuated drastically, often gaining or losing 10-20% in a single day. But those swings eventually led to massive growth. The trader says that ETH may be entering a similar phase, a period of high potential, but also high risk.
High Volatility Expected with Ethereum (ETH)
The trader goes on to say:
High volatility makes consistent coin notional position sizes challenging.
According to the trader, ETH is showcasing massive volatility with major price swings. The trader warns that keeping the usual notional positions could be risky. Notional positions refer to the total dollar value of your trade. For example, if you buy 1 ETH at $4,600, your position size is $4,600.
Moreover, according to the data from Santiment, the chart below shows the relation between ETH’s price (green line) and the price volatility for the past 28 days or 4 weeks (red line). When the volatility rises, it is often reflected by a big price movement either upwards or downwards. Based on the chart, Ethereum has mostly trended towards the higher side upon increased volatility. Since ETH is already in a strong uptrend, this could mean a push above $5,000, but it also means price swings could get more intense, so it’s important to stay cautious and manage your risk.
Risk Management: “Adjust Size”
Adjust size; 1 ETH = $4.6K now.
In other words, don’t buy too much Ethereum in one trade, especially if you’re using leverage (borrowing money to increase your position). With ETH priced at around $4,600, even one coin can be a large and risky position for many traders.
It is much better to consider holding positions worth 0.1 ETH or 0.25 ETH instead of 1 ETH, in order to minimize losses during such a volatile environment.
“Don’t Get Liquidated Before the Move”
The most important part of the tweet might be this line:
I expect ETH to run past $5K sooner or later, don’t get liquidated before.
The trader expects Ethereum to surpass $5K sooner or later, but says this with a warning to traders who are currently undertaking or planning to take aggressive leveraged positions. Due to the extreme volatility, these liquidations could result in traders facing losses before ETH reaches $5K. The takeaway: surviving the volatility is just as important as predicting the right direction.
Final Thought
This tweet wasn’t just about predicting ETH’s next big move; it was a reminder to stay disciplined. Many new traders get caught up in hype and end up risking too much, too soon.
If ETH truly is following the early path of Bitcoin, the opportunity is real but only for those who can manage their risk and survive the volatility.
