Ethereum has proven surprisingly resilient in what has been a turbulent week for traditional markets. With hot inflation data spooking stocks and bonds, many thought that crypto markets would similarly tank. But ETH held strong, sustaining over the $1k mark and bouncing nicely over the past two days. Could the bottom be in?
Let’s take a look at the charts and see what might be next for ETH.
Ethereum Price Analysis
On the 4H chart, the moving averages are consolidating in a tightening range and are beginning to look bullish. The price has finally broken above the 4H 200 SMA, which acted as resistance upon the last test. In fact, the 50SMA has broken above the 200SMA, and the 100SMA is approaching the line to set up a potential golden cross. This would be a very bullish indication. I expect the lowest moving average line to act as support upon any retrace, currently at $1.1k. We also have range support at $1k, and local bottom support around $800.
The RSI on this low timeframe is beginning to look overbought, and stochastic is at the top of its range. This suggests we may have continued consolidation or a slight pullback before a golden cross is confirmed.
On the daily chart, the moving averages are still bearish, but the price is finally approaching the 50SMA for its first big test. This will act as an important resistance level, and is currently priced at $1357.
Daily RSI is neutral and stochastic is nearing the top of its range. This is neutral since the Stochastic could hover at range highs for a few days.
The weekly chart still looks very bullish. RSI and Stochastic are both heavily oversold, and the second weekly green candle in a row is beginning to give it upward momentum. We could see a major relief rally come late summer.
Ethereum Investor Sentiment
Despite the budding bullish indicators we see on all time frames, investor sentiment remains fearful. This is slightly bullish, as it could be a signal that traders are in “disbelief”.
Ethereum Fundamental Analysis
ETH network usage remains stable at a low level, burning about 17% of emissions over the past week.
Major breaking news as of this morning, Ethereum developers confirmed the merge date for September 19th. This will be the largest network upgrade for Ethereum in its history, and will transform the tokenomics to a net deflationary asset. Read details here
Ethereum has broken above the 4H 200SMA for the first time in months, and is finally showing some signs of life and resiliency despite difficult market conditions. With the merge date officially set, the worst could be over for ETH. The stage is being set for a late summer / early fall bull run or major relief rally, which coincides with the merge date news. When bullish catalysts and signals converge, the likelihood is high for positive price movement.
Not investment advice. Do your own research.