Following BlackRock's filing of a Bitcoin ETF on June 15th, we saw a significant surge in Ethereum’s value given the tight correlation with Bitcoin. Ethereum surged quickly from the 1681 level and almost touched the 2000 mark. Despite the recent expectations of higher interest rates and regulatory crackdowns, the cryptocurrency has displayed remarkable resilience. However, if the risk sentiment turns negative, we could see a notable fall, and therefore it’s crucial to closely monitor the underlying fundamentals.
Ethereum Technical Analysis – Daily Timeframe
On the daily chart, we can see that Ethereum’s strong rally stalled at the 1930 level with a brief try to touch the 2000 mark. The price has since pulled back into the previous swing low level at 1820 and started to consolidate beneath the red 21 moving average. Given the downside crossover of the moving averages, we might see another selloff in Ethereum, but a lot will depend the risk sentiment.
Ethereum Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that we had a divergence with the MACD signalling a possible pullback. In fact, the divergence is generally a sign of weakening momentum often followed by pullbacks or reversals. The price has retraced all the way back to the previous swing low level where it bounced. The target should now be the 1930 resistance first and the 2100 high next. A break below the 1820 support though, would open the door for a quick selloff into the 1681 level.
Ethereum Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that Ethereum is now trading withing a rising channel. A break above the channel and the 1930 resistance should give the buyers control to take the cryptocurrency into the 2100 high. On the other hand, a break below the lower bound of the channel would see the sellers piling in to extend the fall into the 1820 support first and then target the 1681 level.
Upcoming Events
Today, we have the US CPI report release, which holds big significance as it has the potential to influence market dynamics in the upcoming weeks. Should the data beat expectations, particularly on the core numbers, we can expect a shift towards risk-off sentiment in the markets, resulting in a selloff for Ethereum. Conversely, if the data misses expectations, a positive mood is likely to prevail in the market, leading to a potential rally into the 2000 mark. As the week draws to a close, we will see the US Jobless Claims report on Thursday, followed by the University of Michigan Consumer Sentiment report on Friday.
