The upward trajectory of Ethereum’s price experienced a momentary pause as it encountered resistance, putting the brakes on the July uptrend that had carried it to $1,950. Initially, the rejection was gradual, with ETH pivoting at $1,920. However, waves of bearish pressure swept through the market on Thursday, pushing Ethereum’s price below the $1,900 mark, but managing to find support at $1,825.
This temporary dip can be attributed to several economic indicators released this week that fell short of investor expectations. Concerns grew over the Federal Reserve’s hawkish stance on inflation, fueling worries about the potential for severe inflation in the United States. Presently, Ethereum’s price has partially recovered, trading at $1,856 at the time of writing, as bulls strive to regain approximately 3.5% of the losses incurred in the past 24 hours.
Despite the recent setback, sentiment across the crypto market remains predominantly bullish, driven by institutional interest. Institutional investors continue to reassure retail investors of a potential breakout to price levels of $2,000 and $2,200, bolstering confidence in Ethereum’s future prospects.
Moreover, the existence of a robust buyer congestion zone above $1,820 suggests that further losses may be constrained. Consequently, the dip to $1,825 presents an opportunity for investors to acquire Ethereum at a relatively lower price compared to the peak reached in July, which hovered around $1,950.
For traders seeking to capitalize on potential price gains, it is essential to monitor specific conditions. One key indicator to watch is the Moving Average Convergence Divergence (MACD) indicator, which must confirm a buy signal. Traders will observe the MACD line (blue) crossing above the signal line (red) when the momentum indicator is below the mean line (0.00). Such a signal may encourage more traders to bet on a rebound, particularly in light of the recent dip to $1,825.
Additionally, the Relative Strength Index (RSI) can further bolster the bullish narrative as the indicator rebounds from the oversold region, slightly below 30. This bounce-back indicates potential renewed strength in Ethereum’s price.
To validate a breakout, Ethereum must surpass and maintain a hold above the immediate resistance posed by the 200-day Exponential Moving Average (EMA). Such a move should be accompanied by a surge in trading volume as traders trigger their buy orders, solidifying the upward momentum.
While some traders may opt to secure conservative profits around the $1,890 level, those maintaining a steadfastly bullish outlook may choose to wait until ETH retests the $1,900 resistance and attempts another breakout towards the $2,000 threshold. Other notable levels to monitor on the upside include the 100-day EMA (in blue) at $1,883 and the 50-day EMA (in red) at $1,904.
Looking beyond price fluctuations, Ethereum’s fundamentals portray a healthy and growing network. This week, there has been an intriguing shift in the Ethereum network growth, with an accelerated pace of newly created addresses. Santiment, a crypto market data provider, reports that the surge in the number of newly created addresses is a positive signal for eventual market cap growth. This surge indicates an expected increase in demand for Ethereum as investors double down on their bullish efforts.
Considering these factors, buying the dip in Ethereum’s price presents a potential profitable entry point. Investors and traders recognize the network’s growth potential and anticipate a rebound, eyeing price targets of $2,000 and $2,200. The continued institutional interest, coupled with a strong buyer zone, reinforces the belief in Ethereum’s long-term prospects.
In conclusion, while Ethereum’s price temporarily halted its upward momentum, the underlying bullish sentiment remains intact. Institutional interest, coupled with the robust buyer support zone, suggests that the recent dip presents an opportunity for investors to enter the market at a relatively lower price. Traders closely analyze key indicators such as the MACD and RSI for confirmation of a rebound, targeting price levels of $2,000 and $2,200. Additionally, Ethereum’s healthy network growth, with an increase in newly created addresses, signals the potential for future market cap growth. By considering these factors, investors position themselves to potentially benefit from Ethereum’s upward trajectory.
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