Ethereum is now testing a key support level that last helped it rebound by over 160%. Multiple factors support this bullish fractal.
Ether (ETH), Ethereum’s native token, is on track to post its first October loss since 2018, having fallen 5.40% month-to-date to reach $2,475 on Oct. 27.
ETH/USD daily price chart. Source: TradingView
The decline is driven by intensifying competition from newer smart contract platforms like Solana (SOL) and the tepid market response to Ethereum-based spot ETFs.
ETH price could rise 40% from its bullish fractal pattern despite Ether’s sideways consolidation over the past week.
Since dropping under $2,450 on Oct. 2, Ether (ETH) price has consolidated between a narrow gap of $100 over the past nine days. While Bitcoin has exhibited market volatility, Ether’s weekly returns represent a mere 1% decline.
On the weekly chart, Ethereum has also maintained a bullish position by holding above the 200-day EMA trendline.
ETH/USD on the weekly chart. Source: TradingView
Buterin’s recent transfer of 1,100 ETH to exchanges coincides with the Ethereum Foundation’s Ether sales worth over $200 million.
Ethereum co-founder Vitalik Buterin transferred about $10 million worth of his Ether holdings to wallets associated with crypto exchanges in August, according to data tracked by Lookonchain.
Additionally, Arkham Intelligence data shows Buterin’s Ether address has witnessed outflows of around 422,000 ETH (worth $1.04 billion as of Sept. 1, 2024) since 2015. Over 840,000 ETH have moved out of the address in the last two years.
The transfers led to speculation that Buterin has been selling his Ether holdings to realize Ether profits, especially as the cryptocurrency is trading 180% higher compared to its cycle low of $885 in 2022.
A confluence of at least three different bearish indicators appears on Ethereum's multi-timeframe charts, suggesting that its ongoing bull run risks exhaustion.
Ethereum's native token Ether (ETH) is at risk of falling below $3,200 in the coming sessions as its rally comes face-to-face with a strong resistance zone.
In detail, the price of Ether swelled by almost 22% on a month-to-date timeframe in the wake of a market-wide price rally. That pushed the second-largest cryptocurrency by market capitalization from under $3,000 to above $3,650 in the first eight days of October, triggering more bullish forecasts.
"Six thousand dollars will happen fast; $10,000 is programmed," noted Twitter-based technical chartist Crypto Cactus. David Gokhshtein, CEO of distributed data network PAC Protocol, predicted a $10,000 upside target for Ether, as well.
Waiting for $ETH to cross $10,000 so the party can really get underway.
— David Gokhshtein (@davidgokhshtein) October 8, 2021
Side note: The only thing I’m thinking about is, how will the #NFT market react?
But the price of Ether has the potential to ram into a confluence of three notable bearish indicators that could limit its upside moves and pare a portion of its recent gains.
The three bearish indicators that could prompt Ether to undergo a bearish reversal are a rising wedge, a descending trendline resistance, and an interim resistance bar, as shown in the chart below.
A rising wedge surfaced as ETH rallied and left behind a sequence of higher highs and lower lows. Meanwhile, the cryptocurrency's uptrend happened against decreasing volume, showing a lack of bullish conviction among traders.
Additionally, the structure's apex—the point at which its two trendlines converge—is around two historical resistance zones. The first one is an interim resistance bar, as shown in the chart above, that previously called out ETH's top above $3,650.
At the same time, the second resistance is a descending trendline, visible more clearly in the daily chart below at around $3,800.
As a result, the rising wedge's apex and the two resistance trendlines pose bearish reversal risks to Ether. Should it happen, the Ethereum token will crash by as much as the maximum height between the wedge's upper and lower trendlines.
Related: 3 factors that can send Ethereum price to 100% gains in Q4
That puts it en route to below $3,200, which served as an accumulation zone for Ethereum traders in the first half of September 2021.
A drop towards or below $3,200 does not necessarily push Ether into a full-fledged bearish cycle. Conversely, it could trigger a bullish inverse head and shoulder setup.
If the setup plays out as intended, traders' accumulation of ETH tokens will increase near $3,200, causing a rebound toward the neckline area in the chart above. In doing so, the ETH price would place its inverse head and shoulder target at a length equal to the maximum distance between the pattern's neckline and bottom.
That would put Ether en route to new all-time highs of approximately $4,500.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Ethereum prices recovered on Sunday amid a market-wide upside correction while receiving an additional upside boost from a bullish JPMorgan & Chase report.
Ethereum's native token Ether (ETH) staged a rebound on Sept. 26 following a massive decline earlier this week that saw its prices plunging to as low as $2,651 on Coinbase.
The ETH/USD exchange rate rose 3.63% to hit an intraday high of $3,030. The upside move amounted to a 14.3% upside retracement from the pair's week-to-date low at $2,651, showing that traders attempted to retain their bullish bias despite potential headwinds ahead.
Last week, Ether prices fell due to a flurry of issues arising from China. On Monday, traders dumped crypto assets en masse after a tumult in China's heavily indebted property market prompted a selloff across global stock markets.
A rebound move ensued later in the week but met with another selloff on Friday after People's Bank of China reiterated that crypto transactions are illegal. Nonetheless, Ethereum bulls maintained their foothold and pushed prices back above $3,000, a psychological resistance level.
The sentiments were similar across some top crypto assets, with the benchmark cryptocurrency Bitcoin hitting an intraday high of $43,767 on Coinbase following a 2.49% upside move. Meanwhile, Uniswap exchange's native asset UNI also fared higher by more than 19%, becoming the top-performing crypto asset at least in the previous 24 hours.
At the same time, Ethereum's top rivals Cardano (ADA) and Solana (SOL) performed poorly, with ADA/USD dropping more than 5% and SOL/USD losing over 3% on a 24-hour adjusted timeframe.
Ethereum gains also followed a bullish report thifrom JPMorgan & Chase. The study noted that institutional investors have started increasing their exposure in Ethereum markets.
Analysts at JPMorgan credited the ongoing craze in the decentralized finance (DeFi) and nonfungible token (NFT) sector as the primary driver behind investors' interest in Ethereum. They added that the 21-day average Ethereum Futures premium climbed to 1% over spot ETH prices, citing the Chicago Mercantile Exchange (CME) data recorded since August.
The JPMorgan report coincided with a record amount of Ether tokens getting withdrawn out of all crypto exchanges, as per data provided by CryptoQuant. At press time, the net ETH reserves on trading platforms had dropped to 18.44 million ETH compared to 23.94 million ETH a year ago.
Related: Ethereum drops more than Bitcoin as China escalates crypto ban, ETH/BTC at 3-week low
Independent analyst PostyXBT also anticipates a potential further price rebound in Ethereum markets, noting that the cryptocurrency's latest declines had pushed it inside a classic accumulation range, as shown in the chart below.
"Weekly close equally as important for ETH today as price tests the previous range highs as support," the analyst noted.
"Seems like a logical area to make a higher low and I have bought more here for long-term bags/swing trade. RR looks favorable after a 33% correction from the local top."
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Meanwhile, the amount staked in Ethereum 2.0 smart contracts reached over 7.75 million ETH.
The total amount of Ether (ETH) held by all the crypto exchanges fell to its lowest levels, just as its prices rose back above $3,000 per token on Sept. 23.
Data collected by CryptoQuant, a blockchain analytics platform, showed that exchanges' net Ethereum token reserves dropped to 18.533 million ETH, compared to 23.92 million ETH a year ago. Meanwhile, the cost to purchase one Ether rose from almost $349 to as high as $3,078, showcasing an inverse correlation between ETH reserves on exchanges and prices.
Lower exchange reserves point to traders' likelihood of holding the underlying cryptocurrency than trading it for other digital/fiat assets. Hence, if the demand for the token tends to rise, the lack of adequate supply helps to boost prices.
So it appears, Ethereum's native token has started fitting the classic low supply-high demand bullish model. For instance, Dapp Radar reported that the total value locked (TVL) across the decentralized applications industry reached $142 billion, out of which 68% was concentrated on the Ethereum network as of August 2021.
On the other hand, more and more Ether tokens started going out of active supply after Ethereum announced its staking feature in Nov 2020, as the network geared up to become a full-fledged proof-of-stake blockchain by 2022.
In detail, the TVL inside the so-called Ethereum 2.0 smart contracts rose from 11,616 ETH in November 2020 to 7.75 million ETH today.
Additionally, a major network upgrade on August 5, 2021, dubbed London Hard Fork, added a feature that trimmed the pace at which Ether supply grows. The change, called EIP-1559, started splitting almost 13,000 new ETH issued every day for miner payment fees into three parts.
The network started burning one of these splits—the base fee users pay to miners to process transactions. As a result, more ETH tokens went out of supply. Data tracking portal WatchTheBurn.com noted that the EIP-1559 feature has contributed in the burning of 352,262 ETH to date, which is about $1.1 billion per the current exchange rates.
Lark Davis, an independent cryptocurrency market analyst, stated that the ongoing supply-demand dynamics in the Ethereum market would help shoot ETH prices towards $10,000.
#ethereum supply on exchanges just keeps dropping, and the price just keeps rising. $10,000 is programmed in already. pic.twitter.com/jRTUYHK4Ca
— Lark Davis (@TheCryptoLark) September 17, 2021
Cryptocurrency markets this week performed in response to a looming housing crisis in Chinese property sector and its ripple effect across global economies.
In detail, the ETH/USD exchange rate dropped 20.78% in the first two days of this week, going to as low as $2,651, as investors limited exposure in riskier markets and scrapped for safest havens like the U.S. dollar and Treasury bonds. Fears of contagion from the debt crisis at China Evergrande Group, which owes billions of dollars of bonds to global investors, sparked the sell-off.
Ether bounced by as much as 18.82% after bottoming out locally at $2,651, including a 2.33% increase to $3,150 on Thursday. Nonetheless, the cryptocurrency's 50-day exponential moving average (50-day EMA) near $3,191 and 20-day EMA near $3,291 acted as strong resistance targets.
Related: Ethereum forming a double top? ETH price loses 12.5% amid Evergrande contagion fears
Blockchain data tracking service Santiment noted that the Ethereum token might keep bouncing as long as its short-term holders remain unprofitable. The portal cited the market value to realized value (MVRV) ratio—calculated on a seven-day average—behind its bullish analogy.
Excerpt from Santiment's Wednesday report:
"Short-term wise, MVRV 7D is suggesting a bounce, but the real rally is unlikely until we get closer to the next major speculative event - The transition to Proof-of-Stake (PoS) in 2022."
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
The second-largest cryptocurrency reaches its best levels against Bitcoin and the dollar in more than three months.
Ethereum's native asset Ether (ETH) has extended its rally on Sep. 1 to log multi-month highs against Bitcoin (BTC) and the United States dollar (USD).
The ETH/BTC exchange rate rose 3.13% to hit 0.07475 for the first time since June 9. Meanwhile, bids for ETH/USD climbed 3.4% to $3,546, the highest since May 18, showcasing a renewed upside sentiment in the second-largest cryptocurrency market after it consolidated sideways for more than three weeks.
Ether's price jump appeared despite a wobbling price behavior across the cryptocurrency market. For instance, Bitcoin prices remained stuck around $47,000 while eyeing a clear breakout move above their psychological resistance level of $50,000.
Similarly, Ethereum's top rival Cardano (ADA) also consolidated sideways following its 100%-plus price rally in August, while its market dominance fell from 4.54% between Aug. 8 to 4.26% at the time of writing.
The same period witnessed Ethereum's market dominance rising from 18.17% to 19.65%, hinting that Ether attracted capital out of assets with interim overstretched valuations.
Ethereum's run up above $3,500 coincides with a decline in ETH reserves across all exchanges.
Blockchain analytics firm CryptoQuant reported that the amount of Ether held in exchange wallets has declined from 19.45 million on Aug. 18 to 18.75 million today.
However, analysts perceive falling reserves as bullish, arguing that traders primarily withdraw their coins from exchanges because they choose to hold them instead of selling them for other assets.
Additionally, more upside cues for Ether prices have emerged due to supply squeeze prospects.
CryptoQuant data shows that more than 6% of Ether's supply now stands locked inside the Ethereum 2.0 smart contract, i.e., about 7.28 million ETH, worth $25.77 billion at current exchange rates.
Additionally, a new Ethereum network update, dubbed "London Hard Fork," has introduced a protocol that burns a fraction of its gas fees. Since its introduction on Aug. 5, the so-called EIP-1559 has removed 156,986 ETH worth over $555 million out of supply, per data provided by WatchTheBurn.com.
Ether has already climbed over 380% in 2021, its gains boosted by the emerging decentralized finance (DeFi) and nonfungible token (NFT) sector. In comparison, Bitcoin has gained 62% year-to-date against the dollar.
Payal Shah, director of equity and cryptocurrency product development at CME Group, noted that Ethereum is equivalent to DeFi, a sector that enables users to trade, as well as borrow and lend directly assets to one another without involving central authorities like banks.
"Ethereum hosts more than 200,000 ERC tokens, some of which are part of the top 100 largest cryptocurrencies," Shah wrote in a note published mid-August.
"Together, with the accessibility of DeFi and the draw of better interest rates, more and more retail consumers will likely turn to the DeFi space."
Data tracker Dapp Radar reports that the total value locked inside Ethereum-backed DeFi protocols has crossed $100 billion.
But Ethereum is racing against a long list of rivals as it grapples with network congestion and higher fees issues. For instance, Cardano employs a dual-layer design to perform computations and settlements separately and thus solve the network congestion issues.
Additionally, Cardano consumes almost no energy due to its PoS system. Ethereum expects to switch fully to proof-of-stake by 2022-2023, which gives Cardano and similar Ethereum rivals a lot of room to grow.
But Ethereum has a first-mover advantage in the blockchain space, compared to Cardano, which has very few decentralized applications to show.
Related: Institutions remain bullish on Cardano and Ether, while BTC outflows persist
"Ethereum is the place to be, already boasting thousands of DApps," said investment analysts at the Value Trend, adding that:
It simply makes more commercial sense, at the moment, to build an app on Ethereum.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Ethereum is breaking out against Bitcoin and traders are turning bullish on ETH/BTC and altcoins.
Ether (ETH) price is seeing green in its Bitcoin (BTC) pair on April 21, reaching the highest levels since early February. Given the technical breakout of ETH/BTC, traders are beginning to expect a strong rally in the foreseeable future.
During the first two weeks of April, ETH was outperformed by Binance Coin (BNB), the native token of Binance Smart Chain.
The high transaction fees on Ethereum coupled with the high user activity on Binance Smart Chain led BNB to gain momentum against Ether.
However, in the past few days, ETH price has started to rally against both Bitcoin and BNB, the first and third largest cryptocurrencies in the global market, respectively.
In the past 24 hours, led by Ether, the altcoin market gained against Bitcoin, causing the Bitcoin Dominance Index to fall to 50.7% on CoinMarketCap, the lowest level since summer 2018.
One main reason why the altcoin market is rallying is because altcoins generally saw sharper drops than BTC following the Coinbase listing.
Hence, when Bitcoin began to consolidate and stabilize, altcoins started to see a relief rally, led by Ethereum and BNB's momentum.
After the futures market recovered, following over $10 billion worth of liquidations on a single day, the appetite for risk-on assets within crypto also likely rose.
This drove the demand for Ethereum, BNB, Dogecoin (DOGE), and many other cryptocurrencies with relatively high volume and valuation.
In the near term, traders say that the breakout of the ETH/BTC pair could lead to a broader parabolic rally, particularly for altcoins.
A pseudonymous trader known as "Crypto Capo" expressed optimism towards ETH's breakout against BTC. He said:
"$ETH/BTC is going to redefine the concept of parabolic."
Similarly, a cryptocurrency derivatives trader NekoZ said that ETH is showing strong momentum, which would likely spill over to altcoins.
The trader noted:
"Love the reaction we are having so far. Should carry nicely into the week and build momentum around alts."
Another respected cryptocurrency derivatives trader known as "Bluntz" said that ETH/BTC looks "insane" after a massive capitulation event.
A capitulation event refers to a scenario when an asset's price bottoms out after a sharp drop.
Bluntz emphasized that ETH is demonstrating a double bottom chart, which in technical analysis often points toward a short-term trend reversal.
He wrote:
"ETH double bottom on 4h, and ETH/BTC looks absolutely insane again. Wow that was the greatest capitulation event I can remember for a long time. Even i capitulated most of my lev trades."
According to the data from CryptoQuant, the amount of ETH being staked in the Ethereum 2.0 deposit contract is rising.
This decreases the circulating supply of ETH on exchanges, which should put upward pressure on the price of ETH.
The increase in fees, which is verifiable through on-chain data, also indicates that activity continues to rise on Ethereum despite the already high fees.
Aftab Hossain, an Ethereum and investor, said:
"Ethereum / DeFi has focused heavily on infrastructure, which BSC was able to copy and centralize to make it faster with an incentive to focus on integrated UX i think cheaper L2 tx's will enable for greater scaling and will allow for critical smart contract wallet innovation."
Binance Smart Chain and other layer ones have been performing strongly against Ethereum, but the release of Eth2 and layer two solutions could make Ethereum more compelling for casual users in the months to come.
