Ethereum Targets $3,000 Despite Death Cross Warning
The Ethereum price chart is etching a warning signal in a death cross between the 50 and 200-day moving averages. Nonetheless, ETH has been propped above support with the help of Bitcoin’s bullish momentum and its upcoming supply-reducing EIP-1559 update.
Ethereum Continues Push
Although Ethereum is showing a death cross, the outlook for the second crypto seems bullish.
Ethereum could be ready for an uptrend ahead of its major EIP-1559 upgrade shipping next week, but technically, ETH faces many hurdles on the way to $3,000.
The ETH/USD chart currently flashes a red signal in a death cross between the 50 and 200-day moving averages. The larger of the two moving averages moving above the smaller one (in this case, the 50-day moving average) suggests weakness in the bullish trend.
The support at the intersection of the two moving averages around $2,100 is crucial for Ethereum. The resistance to the upside is at $2,650.
The ETH/BTC chart is attempting to break away from the multi-year support and resistance level between the ratios of 0.058 and 0.063. A weekly close on either side of this band would further amplify the buying or sell-off.
According to data from Glassnode, Wallets with more than 1,000 ETH worth $2.4 million have booked profits in the last two days. The total number of addresses with more than 1,000 ETH has fallen to 6,538 from 6,377, accounting for 19 whale wallet sell-offs.
Nonetheless, Ethereum traders seem attracted to the recent increase in volatility as they look to capture short-term gains around next week’s EIP-1559 launch. The fee burning proposal, which will see a portion of ETH get burned with every transaction, will ship as part of the London hardfork at block 12,965,000, expected to land around Aug. 4.
The volume of open interest for Ethereum futures climbed to $5.99 billion yesterday, the highest in one month.
Moreover, today marks the last trading day before the expiration of monthly options contracts. The volume of open interest for Ethereum options contracts reached a monthly high of $2.95 billion. More than $21 billion in options contracts is set to expire tomorrow with close to $15 billion in call (or buy) options. The maximum pain price for tomorrow’s ETH options expiry is $2,350.
Meanwhile, Bitcoin’s consolidation of around $40,000 is starting to build bullish momentum, but it faces tough resistance at $42,000. A negative reaction from the top cryptocurrency can have an impact on the price of ETH. Pankaj Balani, the CEO of Delta Exchange, wrote to Crypto Briefing in an e-mail”
“For the July expiry tomorrow, the activity has been in the $40,000 to $44,000 strike calls. $42,000 is the most sold strike here and it should act as a ceiling for this expiry.”
The fundamental and technical indicators are currently giving a mixed signal for Ethereum. While the momentum is to the upside, traders must be wary of the support levels in Bitcoin around $36,000 and ETH between $2,100-$2,150.
Back to the list