FUNDAMENTAL OVERVIEW
Ethereum has been stuck
in a range for over a week now as negative macro conditions capped further
gains.
The
Ethereum Foundation announced on September 28 that the Glamsterdam upgrade’s
first public test on Sepolia is scheduled for October 6. Glamsterdam is
important for Ethereum because it is designed to increase the network’s
capacity and scalability. The increased capacity could ultimately lead to additional
network usage and demand for Ethereum blockspace that translates into greater
economic value.
On the macro side, the US and Iran are
still engaged in negotiations to amend Iran’s recent proposal to reopen the
Strait of Hormuz within seven days under certain conditions. The disagreement
now reportedly centres on the sequencing of the steps rather than the
components of the plan.
Iran’s government
spokesperson said yesterday that the Foreign Minister Araghchi presented to the
cabinet “a US proposal”, although no further details were given.
Traders will therefore keep a close eye on the headlines for more information.
Fed’s Williamsprovided
some support to the crypto market after he said that he didn’t see any urgency
after the September hike and that one further hike was likely if the economy
performed as expected. His comments triggered a dovish repricing and the odds
for a rate hike in October fell from 70% to 45%.
Finally, the US Core PCE surprised to the downside yesterday lowering
further October hike probabilities. Keep in mind, though, that the PCE data
surprised to the downside mainly due to BEA’s annual methodological update and
revisions.
In fact, the BEA changed how some prices are constructed. There was
enough uncertainty around these changes that economists had warned beforehand
that the revisions could materially lower reported core PCE. All in all, it
wasn’t a game changer.
Looking ahead, the focus will remain mainly on
US-Iran developments. A breakthrough would be positive for Ethereum as the
aggressive Fed rate hike bets will likely get pared back. A negative outcome or
a prolonged stalemate, on the other hand, will likely continue to keep a lid on
the risk sentiment and the crypto market.
ETHEREUM TECHNICAL
ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can
see that Ethereumis still consolidating near
the major upward trendline. We can expect the buyers to lean on the trendline,
with a defined risk below it, to position for a rally into the 3,000 level. The
sellers, on the other hand, will want to see the price breaking lower to pile
in for a drop into the 2,360 level next.
ETHEREUM TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we have
a resistance zone around the 2,740 level where the price got rejected from
several times in the past days. The sellers will likely continue to step in
around the resistance, with a defined risk above it, to keep targeting a break
below the major trendline. The buyers, on the other hand, will look for a break
higher to pile in for a rally into the 3,000 level next.
ETHEREUM TECHNICAL
ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, there’s
not much we can add here as the sellers will have a better risk to reward setup
around the resistance and on the break of the trendline, while the buyers will
look for a rejection around the trendline or a break above the resistance to
position for new highs.
UPCOMING CATALYSTS
Todaywe
get the US ISM Manufacturing PMI and the latest US Jobless Claims figures. Tomorrow,
we conclude the week with the US NFP report. The focus, though, will remain on
US-Iran developments.
This article was written by Giuseppe Dellamotta at investinglive.com.