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Ethereum (ETH) Price Surges on Positive CPI Data, Challenges Significant Levels

source-logo  thenewscrypto.com 12 June 2024 21:25, UTC
  • The positive May US CPI data, showing a decrease in inflation, has triggered a strong recovery in major crypto assets.
  • Ethereum has witnessed an increase in buying activity and a surge in on-chain metrics.
  • ETH price faces immediate resistance at $3,660 and support at $3,430, with the potential to surge towards $3,740 and $4,000 if buying momentum persists.

The release of the May US Consumer Price Index (CPI) data revealed a slight decrease in inflation, dropping from 3.4% in April to 3.3% in May, which has had a positive impact on the cryptocurrency market, leading to a strong recovery in major crypto assets.

As Bitcoin’s price continues to climb towards the $70,000 mark, Ethereum (ETH) has also witnessed an increase in buying activity, testing crucial price levels while experiencing a surge in on-chain metrics.

Positive CPI Report Bolsters Support Levels

The US Consumer Price Index (CPI) remained stable in May, surpassing economists’ expectations of a 0.1% increase and showing an improvement from April’s 0.3% rise. On an annual basis, the CPI increased by 3.3%, aligning with predictions but slightly lower than the previous month’s 3.4%.

The cryptocurrency market reacted positively to this softer CPI report, with BTC price surging towards the $70,000 high and ETH price testing buyers’ patience at the $3,700 level.

Data from IntoTheBlock indicates a significant surge in large transaction volume over the past 48 hours, with Ethereum whales conducting transactions worth over $13 billion.

This surge in whale activity suggests that large investors are accumulating ETH near each price level, anticipating a significant move and contributing to increased volatility.

Despite Ethereum’s dominance in the layer 1 sector, Solana is making strides, particularly in terms of on-chain activity. Data from DappRadar reveals a 9% decrease in Ethereum’s NFT volume over the past week, reaching 105 million, which could potentially accelerate bearish trends for ETH despite its recent price rebound.

Ethereum is currently experiencing a strong upward trend, but it is facing resistance around the $3,660 level, indicating potential profit-taking by short-term traders. Buyers have successfully pushed the price above immediate Fibonacci channels and are currently aiming for a surge above the EMA trend lines.

If the price maintains its current buying momentum, it would suggest that bulls have effectively transformed the $3,430 level into a support zone, increasing the chances of a surge towards the $3,740 target. A breakthrough at this level could potentially propel the price towards the $4,000 milestone.