Although it has retreated now more than 7% from last week’s highs around the $1,680 area, Ether (ETH), the ruling cryptocurrency Ethereum blockchain, is still up close to 18% in the past two weeks. Ethereum is the most popular and well-known decentralized layer-1 blockchain protocol with smart contracts, with the original Ether cryptocurrency being the second most valuable cryptocurrency by market capitalization after the world’s first cryptocurrency Bitcoin.
ETH The seller has been in control over the last few days since Ether failed to try last week to push above the key resistance in the area of $1,680, a failure which seems to have triggered an uptick in profit-taking by short-term speculators. Technical selling by intra-day traders may have played a role – ETH’s latest leg was triggered by a bearish breakout from the cryptocurrency’s short-term pennant structure on the 4-hour candlestick.
Where Next For ETH?
Looking at ETH on a longer time horizon, everything looks more positive. Yes, ETH failed to break above the $1,680 resistance (so far), but the cryptocurrency is no longer stuck in the limits of the long-term downtrend channel that dominated until late 2022 and early 2023.
Ether also continues to trade substantially north of all major moving averages, which are all currently higher. Meanwhile, the rising 50DMA level indicates that, if there is no big drop in ETH in the coming weeks/months, there should be a bullish gold cross in February (when the 50DMA crosses above the 200DMA).
ETH’s latest pullback means that, according to the 14-day Relative Strength Index (RSI), Ether is no longer overbought, indicating that there is room for buying pressure to build again in the days and weeks ahead.
Positive Fundamental Tailwinds
Ethereum-specific macros and fundamentals may continue to decline. On the macro front, the market is expecting a yen the end of the Fed’s interest rate tightening cycle it is soon approaching and at the end of this year and in 2024, The Fed will cut interest rates again. This is due to a rapid retreat in US inflationary pressures and growing signs that the economy is slipping into recession.
The prospect of an easier Fed has boosted crypto historically, as happened in 2019 and then in 2020/2021. Ethereum, meanwhile, is expected to implement a major upgrade at the end of this quarter that will enable staked ETH withdrawals, which is expected to drive new demand for assets, with investors attracted by the prospect of being able to flexibly access stable results. .
The fundamentals of the Ethereum network remain strong, with the number of non-zero balance addresses expected to surpass the important 100 million mark by the end of this year – a proxy for the continued and inevitable adoption of the cryptocurrency. A combination of the above factors may keep ETH supported in the coming weeks and months, so that the cryptocurrency may finally test again in the summer of 2022 north of the $2,000 level.
Alternative to Ethereum
If you are looking for other potential crypto projects along with ETH, we have reviewed the top 15 cryptocurrencies for 2023, as analyzed by CryptoNews Industry Discussion Team.
The list is updated weekly with new altcoins and ICO projects.
Disclaimer: The Industry Talk section features insights by crypto industry players and is not part of Cryptonews.com’s editorial content.
