Ethereum rallied
yesterday as renewed hopes for a US-Iran deal helped improve the risk
sentiment. The market reacted to reports that Iran’s security chief met with
Supreme Leader Khamenei, who reportedly stressed the importance of pursuing
Iran’s interests and securing its conditions to end the war and break the
stalemate.
The prospect of
de-escalation could support Ethereum in the short-term but a sustained trend
will need more concrete developments. With the US midterm elections
approaching, markets are increasingly sensitive to developments that might
bring the conflict closer to an end or lead to another escalation.
This morning,
Reuters reported that Qatari mediators presented Iran with a new draft deal on
Sunday. Tehran is reportedly considering the proposal, with a response expected
by the end of the week. The draft outlines a seven-day timeline for addressing
both sides’ concerns through daily confidence-building measures, potentially
starting early next week. While no agreement is confirmed yet, progress in
negotiations could provide further support for crypto markets.
The focus today
will be on the FOMC decision, with the Fed widely expected to leave rates
unchanged. With no new projections or dot plot expected, the focus will be on
Chair Warsh’s comments and any changes in the statement’s language.
A surprise rate
hike would likely trigger a hawkish repricing, strengthen growth concerns and weigh
on Ethereum. A neutral hold that avoids signalling imminent tightening, on the
other hand, could be interpreted as dovish and trigger a relief rally across
crypto markets.
ETHEREUM TECHNICAL
ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can
see that Ethereumpulled back to retest the broken
2,360 support. We can expect the sellers to step in around the broken support,
with a defined risk above it, to keep targeting the 1,900 level. The buyers, on
the other hand, will need a break above the downward trendline to start
positioning for a rally into the 3,400 level next, with the 2,800 level as the
first target.
ETHEREUM TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we now
have a minor upward trendline defining the recent pullback. If we get a
rejection from the broken support, we can expect the buyers to lean on the
minor trendline, with a defined risk below it, to keep pushing into new highs.
The sellers, on the other hand, will look for a break lower to increase the
bearish bets into the 1,900 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 broken support and the major downward trendline, while the buyers
will need a break above these key levels to open the door for new highs. The
red lines define the average daily range for today.
UPCOMING CATALYSTS
Today we have the FOMC rate
decision. Tomorrow, we get the US GDP report, the US PCE and the latest US
Jobless Claims figures. On Friday, we conclude the week with the US Employment
Cost Index.
This article was written by Giuseppe Dellamotta at investinglive.com.