Ethereum (ETH) stirred up over the past few days, rising above $ 124 in the weekend. Only for the last 24 hours, the cryptocurrency has jumped by 2.36%. The ETH/USD pair was traded at $ 124.36 until I am writing my analysis. One of the reasons for the price increase may be are outflows from Bitcoin, whose funds have flowing into altcoins in combination with ETH.
Ethereum: So close and yet so far from shining again
Still, Ethereum is in a consolidation phase, although development is different from what we saw in Bitcoin. Consolidation price action continued as a whole in the crypto market on Tuesday. After the recent rally on the cryptocurrency market, investors are waiting for a strong move in the hope that the market will see further upside momentum over the news. And this is one of the main reasons prices still see a sharp decline.
The next big event, which is so long-awaited on the market, maybe will be the news of the SEC’s approval of the Bitcoin ETF. Or the approval of the parent company NYSE, supporting Bitcoin futures. If this happens, they will most likely be available for trading on the Bakkt platform and will bring the next big wave of bullish price action, perhaps acting as a magnet for attracting fund managers and investors with huge portfolios. In such a case, the much-needed long-term flow of funds and fundamental support can be provided on the market.
Above the current price, the first resistance is seen at $ 130 (the upper limit of the current range), followed by the psychological and round level of $ 140. If the price succeeds to make a clear break and daily closure above those levels, then the next bull’s target should be at $ 149.15 (high on January 10).
On the other hand, however, it is clear that the current market is set to experience a serious downside move, which is likely to occur sooner rather than later. News hit the market that Ethereum developers downloaded preponed data and block numbers for the Constantinople network from 27th February to 25th February. As the deadline approaches, it is unlikely that the market will provide significant updates and headlines before.
That’s why I think investors are becoming more cautious about the impact of the upgrade on the history of Ethereum’s network. It is possible for investors to start collecting their profits. And this will most likely leave the price very close to the annual bottoms. Retailers (who make up the majority of currency market traders) are expected to flock away and not return until another such rally appears.
On the downside, the nearest support is $ 120 – 119.43 (round level and the law on Monday). A clear broke below this area should trigger further bearish momentum to $ 115.60, where the EMA50 is located. Perhaps it will be difficult for ETH/USD to break through this level quickly, but if it does, nothing should stop the bears from testing the doji on February 7 at 104.02.
On the 4-hour chart, the MACD indicator points down, but with a barely noticeable inclination, so the bullish momentum should not be turned off. However, if the goal of the averages is to reach the zero level of the indicator, the trajectory can take many days if it does not accelerate by a decline in consolidation.
Author: Silviya Velcheva
* The views expressed in this material do not constitute a recommendation or advice for the purchase or sale of cryptocurrencies in the digital assets market or other financial instruments. The predicted forecasts meet the expectations of the author of the material and may not materialize. Trading in currencies, contracts for differences on margin or cryptocurrencies poses a high risk and may not be suitable for all investors. Past results are not a guarantee of future success.