Ethereum Price Analysis: ETH Drops From Bull Pattern But ETH ETF S-1 Approvals Likely In The Summer Could Turn it Around📉🚀
As Bitcoin (BTC) prepares for a quiet summer, Ethereum (ETH), the king of altcoins, might be on the brink of significant activity. According to QCP Capital, Ethereum options are displaying considerably higher volatility compared to Bitcoin, indicating potential trading surges in the coming months despite a market cooldown.
• Current Market Performance
As of June 15, 2024, Ethereum is trading at $3,535, showing a 0.65% increase in the last 24 hours but a 4% decline over the past week. With a market cap of $424.8 billion, Ethereum maintains its status as the dominant altcoin. The trading volume stands at $15.9 billion over the last 24 hours, marking a 13% increase from the previous day.
• Market Sentiment and Volatility
QCP Capital advises traders to accumulate ETH positions, preparing for a “long, quiet summer” for Bitcoin. This strategy could be advantageous if Bitcoin’s volatility remains low while Ethereum benefits from increased trading activity.
One of the most anticipated events is the potential approval of a spot Ethereum Exchange Traded Fund (ETF) later this summer. SEC Chair Gary Gensler recently indicated to Senator Bill Hagerty that Ethereum ETF S-1 filings are likely to be approved “over the course of the summer.” The launch of a spot Ethereum ETF could propel the price to new all-time highs, surpassing the previous record of $4,878 set in November 2021.
• On-Chain Data Analysis
On-chain data from CryptoQuant supports a bullish outlook for Ethereum. Since June 9th, over $1.5 billion worth of Ethereum has been withdrawn from exchanges, reducing exchange reserves by 1.2 million ETH (over $4 billion) since late May. This trend suggests that investors are pulling coins off exchanges to hold long-term rather than selling, often a positive signal for price appreciation.
• Technical Analysis
From a technical perspective, Ethereum recently broke down from a bullish flag pattern after hitting a high of $3,973 on May 27th. The price dropped and closed below the bullish flag, invalidating near-term bullish pressure. Since then, the price has been trading bearishly, poised to find support at the demand zone identified on the chart after the breakout on May 20th.
The 50-day and 100-day exponential moving averages (EMAs) at $3,406 and $3,422, respectively, are providing short-term support. Meanwhile, the 200-day EMA at $2,974 indicates potential for further downside. The price might retrace to the demand zone, clearing liquidity and filling the fair value gap left after the breakout on May 20th, before a strong bullish reversal.
On-chain data from Coinglass shows the ETH futures long-short ratio at 0.94, indicating a slightly bearish sentiment. Additionally, data from The Block shows a decline in new addresses on the network, from over 144k in mid-May to below 100k in June, signaling a temporary loss of bullish momentum.
So concluding all, With the potential approval of a spot Ethereum ETF, rising implied volatility, and bullish on-chain metrics, all eyes will be on Ethereum this summer. While Bitcoin may experience a quieter period, Ethereum appears poised for its next significant move. Traders and investors should closely monitor the market for developments that could trigger a bullish surge, positioning Ethereum for new all-time highs.
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