Last week in Ethereum Price analysis we said:
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.
Our conclusion that the worst was over for ETH and that positive price movement was coming has proven to be true. Over the past week, ETH has risen over 33% and surpassed the $1600 mark, breaking several resistance zones along the way. As ETH continues to gain strength, the $2k resistance is in its sights. But will the bullish momentum carry ETH to this key level?
Let’s take a look at the charts.
Ethereum Price Analysis
On the 4H chart, the moving averages have completed a golden cross. This is when the 50 SMA > 100 SMA > 200 SMA. It’s also referred to as the “alligator” indicator, which is bullish when the “mouth” is open upward.
On the low time frame view, the RSI is slightly overbought and Stochastic has not yet reached the top of its zone. This means there is more room for ETH to run before needing to consolidate. If BTC moves back up to the $24k zone, I expect ETH will move up with it. There is local resistance at $1750, which is a previous consolidation zone from several weeks back.
On the daily chart, ETH has finally broken above the 50SMA, which will now act as support at $1300. The price is moving up to test the 100 SMA resistance, currently priced at around $1900. Note that from this time frame, the moving averages are still in a bearish configuration – but there is bullish divergence.
On the daily, ETH looks ready for a break. The RSI is touching the overbought zone, and Stochastic is at the top of its range. From this perspective, ETH looks likely to touch $1.7k resistance and then continue consolidating fro a few days to regain strength.
The weekly continues to look very strong. RSI and Stochastic are both bouncing upward after a record downtrend. Three green candles in a row appear to be the beginnings of a major relief rally. It’s also important to note that ETH has finally broken above its weekly 200 SMA, located at $1.2k. In the past four cycles, the weekly 200 SMA has been a bottom indicator. Though its early, that also appears to be the case in this cycle. The closest resistance on the weekly is the 100 SMA at $2.25k.
Ethereum Investor Sentiment
The market is bouncing and investors are feeling the relief. The extreme fear has subsided, and sentiment has now edged into “neutral” territory.
Ethereum Fundamental Analysis
Though the market appears to be bottoming and sentiment reversing, fundamentals have not yet picked up. Eth network usage remains low, and fees have only burned ~17% of emissions over the past week. This value is consistent with the lows we have seen throughout the bear market. Ethereum does, however, appear to be leading the market recovery as the merge is the leading narrative in crypto right now. With the tentative date of September 19 less than two months away, we could see this narrative continue to drive market recovery through the end of the summer.
ETH looks bullish on the 4H and Weekly, but set for consolidation on the daily. ETH looks incredibly strong in the long term, as bullish TA and a market-leading narrative set the stage for a strong market recovery. We could, however, see a pullback in the medium term – to confirm support zones and shake out overconfident longs.
- $1.2k (weekly 200 SMA)
- $1.4k (4H 50SMA)
- $1.7k (local)
- $2.25k (major)
Not investment advice. Do your own research.