FUNDAMENTAL OVERVIEW
We haven’t got major idiosyncratic catalysts for Ethereum
this week as the cryptocurrency continued to rally just by inertia. As a
reminder, most cryptocurrencies rallied on Friday after a CFTC
crypto rulemaking submission on Thursday became public.The filings were submitted for
regulatory review after the CLARITY Act failed to advance in the Senate.
The CFTC effectively signalled that it intends to move
forward with a crypto market framework using its existing authority rather than
waiting for Congress. The breakout of the month-long range has also contributed
to the bullish momentum on broad short-covering.
On the macro side, the significant drop in
oil prices on growing expectations of a de-escalation and an earlier end to the
conflict supported risk assets. Yesterday, though, Trump poured some cold water
on those expectations as he repeated that the US would make a deal with Iran after the November
elections. The general risk sentiment started to deteriorate after that.
If the de-escalation continues and markets start to
sense an earlier end to the conflict, then oil prices will continue to drift
lower and support risk assets like cryptocurrencies. Conversely, if the US-Iran
talks fail again and we see a re-escalation, we can expect crude oil to surge
and weigh on risk sentiment, ultimately putting pressure on Ethereum.
ETHEREUM TECHNICAL
ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can
see that Ethereumstalled around the 2,800
level. We have a new major upward trendline now that could act confluence to
the 2,560 support. If we get a pullback into the support, we can expect the
buyers to step in with a defined risk below the trendline to position for a
rally into the 3,000 level. The sellers, on the other hand, will want to see
the price breaking below the trendline 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
an upward trendline defining the recent bullish momentum. The buyers will
likely continue to lean on the 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 extend the pullback into the 2,560 support next.
ETHEREUM TECHNICAL
ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, there’s
not much we can add here but we have a minor downward trendline defining the
current pullback. If the price bounces and moves into the downward trendline,
we can expect the sellers to lean on it with a defined risk above it to target
a break below the upward trendline. The buyers, on the other hand, will look
for a break higher to increase the bullish bets into the 3,000 level next.
UPCOMING CATALYSTS
Todaywe get the Flash US PMIs, while tomorrow we have the
Trump-Xi meeting. The focus will remain on US-Iran developments though.
This article was written by Giuseppe Dellamotta at investinglive.com.