The Ethereum Rainbow Chart is forecasting that the second-largest cryptocurrency by market capitalization is likely to trade within its current range as of June 1.

Notably, Ethereum ($ETH) has been one of the top-performing assets in the ongoing market cycle, having broken out of a prolonged consolidation phase below $2,000.

This rally has been primarily driven by broader market sentiment and key network upgrades. As of press time, $ETHwas trading at $2,565, up 2.93% in the last 24 hours and 6.5% over the past week.

However, short-term momentum may be slowing. In this case, Ethereum’s 14-day Relative Strength Index (RSI) stands at 62.91, indicating the asset is nearing overbought territory.

Still, both the 50-day ($2,024.08) and 200-day ($2,479.18) simple moving averages (SMA) remain below the current price, reinforcing a bullish outlook.

Ethereum price prediction

According to the Ethereum Rainbow Chart, $ETHis projected to trade between $1,588.19 and $2,235.45 on June 1, placing it within the “Still Cheap” band. This range suggests that despite recent price gains, Ethereum remains undervalued relative to its historical growth curve.

Notably, the Rainbow Chart is a sentiment-based, non-scientific model that overlays Ethereum’s price history on a logarithmic growth curve. Rather than relying on traditional technical indicators, it uses color-coded bands to illustrate market sentiment across different valuation levels.

At the top of the chart, the red band, “Maximum Bubble Territory,” spans $13,891.96 to $19,811.01. Below it lies “But have we earned it?” ($9,711.26–$13,891.96), followed by “Is this The Flippening?” ($6,671.98–$9,711.26), “HODL!” ($4,592.33–$6,671.98), and “Steady…” ($3,185.43–$4,592.33).

The “Still Cheap” range extends from $2,235.45 to $3,185.43, just above the “Accumulate” zone ($1,588.19–$2,235.45). Beneath that are “Undervalued” ($1,147.53–$1,588.19) and “Fire Sale” ($845.94–$1,147.53).

Ethereum’s current price trajectory supports the view that it will remain within or near the “Still Cheap” band in early June. While $ETHhas rebounded, it remains far from the chart’s upper, more euphoric valuation zones.

Though the Rainbow Chart offers a compelling visual narrative of Ethereum’s historical price behavior, it is not a predictive tool. Instead, it serves as a simplified framework to contextualize long-term valuation trends.

Featured image via Shutterstock

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